Home mortgage deductions are another area wherein the rich heighten their profits. This completely legal strategy is recommended by business coaches including Wilson Luna and Robert Kiyosaki (of ‘Rich Dad, Poor Dad’ fame). The home mortgage deduction offers exorbitant subsidies to real estate, banking and construction industries, costing taxpayers $70 billion a year. Furthermore, The Centre of Budget and Policy Priorities has estimated approximately 77% of the benefit is given to homeowners who possess incomes exceeding $100,000 per fiscal year.
Corporations scrutinise major pieces of legislation to discover new sources of welfare for their rich employers. The Boston Globe investigated these measures, unearthing that in early 2013, emergency tax legislation passed by Congress contained forty three business and energy tax breaks, worth a total of $67 billion. As well as this broader legislation, there are a wealth of minor breaks which corporations use to protect and consolidate the authority of the rich. These include subsidies for corporate jets as well as tax deductions for second homes. These subsidies even include the rich benefiting from taxpayer funded farm subsidies, from which fifty billionaires received $11.3 million in the past twenty years!
Furthermore, corporations protect their wealthy employers from the repercussions of illegal transactions by affiliating financially with the government. These underhand agreements have been unearthed most recently in the case of JPMorgan Chase. They agreed a preliminary $13-billion mortgage settlement with the US government, yet were allowed to write off a majority of the deal as tax-deductible, thereby saving the corporation $4 billion. Corporations hire a comprehensive team of tax lawyers who scrutinise federal Internal Revenue codes in order to secure financial loopholes for the rich, such as in the case of JPMorgan Chase. By discovering breaks within these tax codes, corporations are able to exponentially reduce their tax rates. It is because of these breaks that there are so many lobbyists within the halls Congress and surrounding state legislature, in order to ensure that the rich remain rich.
This article was written by George Campbell, a freelance writer from Birmingham in England. George has been a teacher for four years and he loves writing about education but he is versatile and he also writes across a variety of other topics. You can stay connected with George on Google+ and follow him on Twitter.