Umm, regulatory capture applies to legislatures as well, not just regulatory agencies.
Consider GE. Its $0 tax bill is not due to regulations, but to laws.
Yes, but losses, gains, revenue, and expenses are not necessarily well-defined. (Heck - even whom is incurring those things is also variable.)
And then there's the big problem - the US govt likes to encourage (and discourage) things via the tax code. GE takes advantage of that as well.
If you apply the same rate of taxes to all companies with the same revenue, regardless of their margins you have your choice of putting all low margin business out of business by assessing a tax higher than they can pay (to collect reasonable revenues from the high margin businesses), or leaving a lot of cash on the table in high margin industries (which as a tax authority you probably don't like).
Suppose there are two companies. The first company buys resource A for 100$ to produce B. The second company buys B for 110$ and produces C, which it sells to the public for 120$. A merger of both companies would approximately half their total revenue, but wouldn't change their total profit.
We don't want the tax system to determine the optimal size of a company.
Pick one and see what can be done.
Pick both - we already know what can be done.
If you're going to argue that this time will be different, you need to explain why. Heck, it would be nice if you understand, deeply, how things work now, what's been tried, and so on.
None of the existing problems are easy to solve.
If certain Monopolistic practices are directly illegal, what about more laws directed against Regulatory Capture?