During the recent federal election campaign, some candidates floated a proposal to raise corporate taxes. The rallying cry that corporations must pay their “fair share” has also been heard in the United States. Democratic Party presidential hopeful Bernie Sanders repeatedly says that corporate taxes have continually decreased and that this is partly why the US government is running a deficit.\nCalling out “big business” for paying less and less tax always strikes a chord with part of the electorate, but it is a false debate.\nWhile it is true that corporate income taxes have decreased in many countries — including Canada — the picture is different if we consider the entire tax burden that companies must shoulder.\nAccording to a recent PricewaterhouseCoopers (PwC) report, for every dollar of corporate tax paid, Canadian businesses put out an additional 94¢ in other taxes (payroll taxes, unrecoverable sales taxes, property taxes, etc.). The upshot is that on average, Canada’s large corporations (financial institutions, telecoms, insurers and natural resource companies) paid 33.4% in income tax and other taxes in 2012. In some provinces, including Quebec, companies are taxed more today than they were 15 or 20 years ago.\nThe Economist also made this point in February 22, 2014 ("Plucking the geese"). Using data from the Organization for Economic Co-operation and Development and PwC, the weekly magazine claimed that multinationals paid an average of 43.1% in all sorts of taxes, including 16.1% in profit-related taxes, 16.3% in payroll taxes and 10.7% in other taxes. The conclusion may surprise many: as a percentage of gross domestic product the total tax take from corporations in developed countries is almost identical to what it was in 1981.\nA FALSE DEBATE\nBut the debate over numbers obscures the real issue. Since companies are only legal entities, they don’t actually “pay” taxes. People do. Corporations simply pass the expense on to owners (lower returns for shareholders), employees (lower wages) and customers (higher prices). And economic research has shown that over the medium and long term, workers pay the lion’s share, through lower wages and fewer employment opportunities. In reality, corporate taxes are passed on to individuals as a dual tax.\nThis is because shareholders can pick up their marbles and play elsewhere at a moment’s notice. Since workers can’t because they are less “mobile,” they end up footing most of the bill.\nNot only is it specious to claim that businesses contribute less to government revenues, but raising their tax burden wouldn’t automatically fill government coffers. This would actually be a disincentive: a stifling tax environment would discourage investment and chase some businesses away, thereby reducing tax revenues.\nThis doesn’t mean that we should turn a blind eye to illegal practices, such as tax evasion. Nor should large corporations receive millions in subsidies (the sole purpose of these gifts is often to help politicians get re-elected).\nBut from a tax policy perspective, gouging corporations through higher taxes is more likely to hurt the economy than help it.