(VATinfo Note: Dobbs does not mention VAT in his book, but he did tell the publisher of this site that he could support replacing other taxes with a VAT.)
“Fifty years ago, corporate income taxes made up a third of all federal revenues; now corporations account for just an eighth. Income taxes from middle-class working families, in contrast, contribute roughly half of all tax revenue collected by the federal government. In 2004, when Congress approved billions in corporate tax cuts, a report by Citizens for Tax Justice showed that the United States’s biggest and most profitable companies had been paying decreasing federal income taxes over the previous three years–despite reporting higher profits Many of them were paying no taxes at all. The CTJ study found that the average effective tax rate for the largest 275 American corporations had dropped by a fifth over those three years, from 21.4 percent in 2001 to 17.2 percent in 2003. These 275 companies reported pretax profits from U.S. operations of almost $1.1 trillion in that three-year period, yet they paid taxes on only $557 billion. That rate is around half of the statutory 35 percent corporate tax rate that companies are obligated to pay to the U.S. government,” p. 30.