Moving corporate income tax to individual income tax would allow to postpone paying any such tax forever, allowing company-owners to skip paying the tax, but allowing them to use the (yet untaxed) funds to purchase/invest whatever they want.
No, it doesn't. The IRS is very good at taxing corporate transfers to individuals (e.g., the company paying for your house, clothes and food) as income.
If this wasn't already a solved problem, we wouldn't even need to eliminate corporate taxes to engage in the scheme you propose. Just book revenue, book your personal expenses as corporate expenses, and the company made no profit and hence needs to pay no taxes.
This is why your company generally only provides you benefits in a very narrow set of categories that happen to be tax deductible (health insurance, 401k).
Yes, the part of the income that you consume would be taxed.
The point is that pretty much all of what megacorps make for their owners is not consumed - on that scale, houses, clothes and food are a small percentage, a rounding error. Don't think about what a small business owner is doing with his profits, think about what happens to profits of Walmart or Microsoft. Not about income of the 1%, but income of the 0.1% (which is the big part).
What is a billionaire doing with his money? A major part of it is reinvested to earn even more money - that can be done through the company; so the main feedback loop of rich-gets-richer is completely untaxed. Part of it is used to fund pet projects (like Virgin Galactic or 10,000 Year Clock project) or buy companies for control/prestige purposes - not taxed. Part of the wealth is simply accumulated to be given to your heirs - if there's no capital gains tax, would an inheritance tax stand? Part of that is used to buy political and social influence by funding parties and advertisement - not taxed. Part of that is used to buy prestige - ok, buying a fancy house to show off is taxed; but buying a major football club to show off isn't.
In essence, this means that the continuing concentration of wealth is untaxed, and you're taxing only the spending of wealth, which is something that actually redistributes wealth to the rest of society. This is not sustainable; that tax policy would fuel a rising and inescapable inequality. The society is better off if billionaires spend their wealth on fancy services (giving fancy income to the service providers), instead of owning all those service providers.
How would that work? If I wanted to buy a house, and I have my corporation do that, then I live there rent free, I still have to pay taxes on the benefit given to me.
You could postpone the taxation until you actually want to use the money to benefit yourself then you are taxed. I believe you can already do it with corporations that are headquartered in low tax jurisdictions.
