Let's Tax Businesses Inversely to How Well They Pay Their Employees
Corporate tax law - at every government level in the US - is inordinately ludicrous. A titanic mess of subsidies, deductions and loopholes. Written by Big Business - for Big Business.
The on-paper federal tax rate for really large US companies is 21%. Except here are some effective federal tax rates paid by some seriously huge companies in 2025:
Tesla made $5.7 billion. And paid $0 in federal income taxes - 0%.
Amazon made $89 billion. And paid $1.2 billion in federal income taxes - 1.4%.
Meta (Facebook) made $78.9 billion. And paid $2.8 billion in federal income taxes - 3.6%.
Alphabet (Google) made $141.6 billion. And paid $11.3 billion in federal income taxes - 8.0%.
The major oil companies averaged in 2025 an effective federal income tax rate of… -6.1%. As in a NEGATIVE tax rate. We the Taxpayers paid them - to make hundreds of billions of dollars.
We are told these absurd tax rates and breaks are in place to incentivize companies to do…basically what they are doing anyway.
Is Amazon going to stop selling in the US if we increase sixfold their effective federal tax rate - to a whopping 8.4%? I highly doubt it.
We are told these corporations deserve these ridiculous tax rates - because they are creating jobs. But what kind of jobs are they creating? What wages are they paying? What benefits are they providing?
Let’s look at wages. Speaking of Amazon….
Amazon in May 2025 had approximately 1.1 million US employees. Making them the second largest employer in the US.
A 2023 University of Illinois Chicago study of 1,484 Amazon workers across 42 states found that 48% used at least one publicly funded assistance program. Which means Amazon was paying them so poorly - they qualified for government poverty programs.
In 2025, Amazon paid 1.4% in federal taxes. In 2025, the average Amazon warehouse worker made $37,440 - and paid $2,602.80 in federal taxes. Which is 7% - or FIVE TIMES the rate Amazon paid. And don’t forget: We the Taxpayers assistance-subsidized about half of all Amazon’s 1.1 million employees.
That math ain’t math-ing.
And we’ve thus far only discussed the federal tax breaks companies like Amazon get. Let’s not forget the state and local breaks they get as well.
Remember the 2018 slavish attempt by cities all across the country to throw many billions of your tax dollars at Jeff Bezos to get him to build Amazon’s second headquarters in their respective confines? To lure and land what was, we were told, 25,000 jobs.
Arlington, Virginia won part of the bribe-fest. The state of Virginia gave Amazon $750 million in government subsidies to choose Arlington. The city of Arlington pledged many millions more.
Except the 25,000 pledged gigs? Then became 10,000. And now - eight years later? Only ~7,200 actual gigs have materialized. And if the government assistance numbers roughly apply? We the Taxpayers are subsidizing half of them - yet again.
In case you were wondering? My analysis of government and business is eminently conservative - and is conducted entirely through the prism of less government.
There is nothing less government about government-subsidizing the world’s all-time richest companies. Their workforces - or their operations.
There is nothing conservative about having the government pick winners and losers. Giving government cronyism to some - and not others? Is picking winners and losers. And our bribe-infested lobbying system ensures that the “winners” - will always be the world’s all-time richest companies.
So…what to do…?
There has been much discussion of how best to utilize tariffs and taxes to make the US more attractive for businesses. Well, as we know, the largest expense for most businesses is the number of humans they hire. (Thus the Artificial Intelligence rush to eradicate humans.)
Of course it is impossible for the US to compete globally with countries that use slave or near-slave labor. When what is for US companies their most expensive budget line item - is a near-non-existent expense for competing companies elsewhere? US companies - and the US - absolutely can not compete.
Unless we provide businesses the proper tax incentives. Like: The more you pay your employees - the less you pay the government.
We currently allow businesses to deduct the wages and salaries they pay. But those deductions are obviously not enough of an incentive to get companies to pay better. Let’s make them so.
Higher-paid employees? Mean less employees qualifying for government programs. Because math.
Of course for our idea to succeed? We must simultaneously clean up our corroded tax system - which currently has Amazon paying a ridiculous 1.4% on $89 billion in profits.
We have to make the wage-and-salary tax incentives more attractive - by removing many of the corrupt-and-crony tax subsidies the likes of Amazon currently get.
We must restore some sense of sanity to their effective tax rates. In order to make reducing them - via their paying better wages and salaries - an attractive notion.
And, of course, a better-paid US workforce? And a less corrupt-and-crony tax code? Is all eminently better for the US.