BTGuy:
Ok fine. You are ignoring two taxes which are very relevant.
1. The Capital Gains tax. We can bicker about how much the KG (capital gains) rate should be, but you can’t simply ignore that it exists.
2. The Corporate Tax. If I invest 1000 dollars in a company which I own, and the company makes 100 dollars, the company pays 35 dollars in tax and is now worth 1065, and then I also pay tax when I either take the other 65 out, or sell my company for 1065. There is a machlokes among the economists regarding who bears the burden of this tax ultimately, for reasons I don’t entirely understand. But again, you cannot simply ignore it.
When I said you cannot spend money without paying tax, I was referring to the income tax-not to the sales tax. I meant that by the time you have the cash, you must have paid either income tax or KG.
Regarding the companies who have international earnings, you are again only referring to the corporate tax. And, who says we should tax companies that are doing business outside the country? Just because they are headquartered in Delaware? And what if most of the investors are also international?