One of the companies I work, belong to the Seminole tribe. They contribute to society in many different ways for charity; donating materials to public hospitals, organizations to provide support for education, donations for the poor and homeless, they are all non-profit, tax exempt charitable organizations. I agree this is a good incentive to help somehow the society, business receive tax incentives, this practice instead of direct spending to promote social and economic goals is growing. Also, they receive tax breaks, which substitute spending programs with the same effects on supply distribution and revenue circulation. Costs of management may vary between them; on the other hand, the charitable tax break is dissimilar from many other tax breaks in so far as it noticeably donates to the public good. But the deduction does advantage individuals — principally those in the superior class.

The tax break is a deduction, which means it can only be requested by individuals who record their tax returns. Because the spending is organized as a deduction, individuals in upper tax groups can use it to remaining bigger savings. Say someone in the 45% tax range make a contribution of $1000. If the donator deducts the donation, the tax bill is reduced by 45% of $1000, or $450. In the meantime, a person with a tax rate of 20% who contributes to the same quantity of money will only save $200. As a consequence, it’s economical for rich people to make contributions. By charitable the rich a superior motivation to contribute, the government is efficiently permitting them better control over the nation’s charitable giving. The funding is subsidized by all taxpayers, but the reasons preferred by the rich do not essentially advantage everyone. These new tax incentives make the tax structure inferior according to the typical tax policy standards of equality, efficacy, and simplicity. Some may also be inefficient or prejudiced methods of expenditure. But numerous tax expenditures encourage significant social objectives, which are worthy of maintenance in some procedure, if not over the tax code. In accumulation, expending the tax system as a payment instrument can occasionally be more profitable than emerging a new spending program. Both the practical qualities of planned new programs and the choice among making it a tax profit or direct spending must be assessed on a case-by-case source.

Part 2

I am working for Saint Joseph’s Hospital that is part of BayCare, which is a significant healthcare organization in Tampa, Florida. In 2012, the organization provided $188, 7 million in community benefits that included traditional charity care, Medicaid and County Welfare and unbilled community services. The CEO Steve Mason stated “Community benefit is an essential expression of BayCare Health System’s mission to improve the health of all we serve through community-based health care services.” (BayCare, 2014) However, the company is a non-for-profit organization, and other tax exemptions apply to this type of business.

The issue of tax breaks for charitable tax deductions applied to corporations is complex and controversial. On the one hand, “tax expenditures, like traditional forms of federal spending, contribute to the federal budget deficit.”(CBO, 2013) Moreover, on the other hand, Chuck Colson said, “Charities especially religious charities, provide services that the government will not or cannot do efficiently as services provided by homeless shelters, prison minister, medical research, and more” (Dolan, 2012). After read several articles related to charities tax deductions and corporate taxes, I agree that companies’ tax breaks for charitable contributions distorts public spending.
According to the article published by Bill Quigley, “a study realized by Louse Story from the New York Times, determined that the state and local government provide at least $80 billion in subsidies to corporations like GM, Shell, Ford, Amazon, Microsoft and more. The Cato Institute estimates that federal subsidies to corporations cost taxpayers almost $100 billion every year. The tax code gives corporations special tax breaks that had been reduced to 13 percent, according to U.S. Government Accountability Office.” (Quigley, 2014) Corporations have special breaks and subsidies; which might imply that charities tax exemptions should be reconsidered at least in the current tax subsidy rate percentage which, can go more than 35%. (Salmon, 2011).

Charity can be interpreting as the action of giving money to the needy, and the U.S. Government encourages the organizations to perform these actions through tax deductions. However, corporations enjoy many privileges as subsidies and tax low rates to incentive the country’s economy. Although, donations and charities contribute positively to the community; the percentage that absorb the Government by these charities affects the public spending. If the charity or donation terminology is understanding as it is, then the government should not deduct contributions from taxes.