ABSTRACT
This chapter aims to capture the essence of the long-standing debate over the desirability of the corporate tax. Corporate taxes constantly struggle with the duality that inheres in dealing with taxpayers that are legal persons but not natural persons. Relying on the legal construct of separate corporate personality, countries generally view corporations as taxpayers essentially independent of their shareholders and other stakeholders, who may be taxpayers themselves. The United States (US) corporate income tax was enacted in 1909, prior to the current individual income tax, but that happened solely due to particular political and historic circumstances, rather than for any policy or other intellectual reasons. The standard study of the US corporate income tax has reached somewhat of a general consensus about the origins of the tax. A tangential distortion that may be viewed as part of the same problem is the effect of the corporate tax on the decision to incorporate.
