News Blog for social, fiscal & national security conservatives who believe in God, family & the USA. Upholding the rights granted by God & guaranteed by the U.S. Constitution, traditional family values, "republican" principles / ideals, transparent & limited "smaller" government, free markets, lower taxes, due process of law, liberty & individual freedom. Content approval rests with the ARRA News Service Editor. Opinions are those of the authors. While varied positions are reported, beliefs & principles remain fixed. No revenue is generated for or by this "Blog" - no paid ads - no payments for articles.Fair Use Doctrine is posted & used. Blogger/Editor/Founder: Bill Smith, Ph.D. [aka: OzarkGuru & 2010 AFP National Blogger of the Year] Contact: editor@arranewsservice.com (Pub. Since July, 2006)Home PageFollow @arra
One of the penalties for refusing to participate in politics
is that you end up being governed by your inferiors. -- Plato
(429-347 BC)
Monday, November 20, 2017
Targeting Inversions: ‘This Is A Really Big Deal’
Tax Reform ‘Would Do Far More To Stop Corporate Tax Gaming Than Anything The Obama Administration Did In Eight Years’
SEN. ROB PORTMAN (R-OH): “I think there is a consensus, at least in the real world, about the fact that our current tax code is hopelessly broken, and we have to fix it, and if you’re against helping our companies stay American companies, that must mean that you believe that they ought to become foreign companies, which is exactly what’s happening. … Ernst and Young, which is a public accounting firm, recently came out with a study showing that 4,700 companies that have become foreign companies over the past 13 years would be still American companies if we were to go to the kind of tax reform proposal that we are proposing.” (Sen. Portman, Floor Remarks, 11/7/2017)
WALL STREET JOURNAL EDITORIAL:“…[the tax reform bills are] a serious attempt to fix a broken U.S. code that has festered for years and made America increasingly uncompetitive as a destination for mobile global capital. The GOP reforms would help the economy and make it harder for corporations to avoid paying taxes.”(Editorial, “Reducing Corporate Tax Games,” The Wall Street Journal, 11/29/2017)
GARY COHN: ‘We're Going To Make America Competitive’
GARY COHN, Director Of The National Economic Council: “Look, a year ago, I was on the other side of this equation. I was advising companies how to get out of the burdensome U.S. tax system. We were talking about inversions — we were talking about moving companies out of the United States. The most compelling presentation I could make to a board is, hey, I can turbocharge your earnings without doing anything in your company. I can just relocate your domicile, and you can hold your board meetings, you can do a few things, and you can go from a 35 percent tax rate to a 15 percent tax rate. You can deliver 20 percent of your earnings to the bottom line. ... So, you know what? We're going to make America competitive. We're going to make it compelling for people to build their companies in America.”(“Gary Cohn: A Year Ago, I Was Advising Companies To Move Out Of The US,” CNBC, 11/9/2017)
IRISH TIMES: “American tax overhaul has worrying implications for Ireland… This is unsettling for Ireland. Addressing the House this week, Paul Ryan – a proud Irish-American – cited the example of Johnson Controls, a company that has had roots in his home state of Wisconsin since the 1880s but is now based in Ireland. The new tax system will help make the United States ‘the most competitive place in the world’, he said. Worrying words for Ireland.”(“American Tax Overhaul Has Worrying Implications For Ireland,” Irish Times, 11/18/2017)
WALL STREET JOURNAL EDITORIAL:“…the Senate and House bills would do far more to stop corporate tax gaming than anything the Obama Administration did in eight years. This includes preventing tax avoidance, levelling the tax field for U.S. multinationals, stopping corporate inversions.”(Editorial, “Reducing Corporate Tax Games,” The Wall Street Journal, 11/29/2017)
WSJ: “Start with cutting the corporate rate to 20% from 35%, which in a stroke offers less incentive for companies to move capital, income and intellectual property out of the U.S. to lower tax climes. During the Obama Administration, many U.S. companies ‘inverted’ by merging with smaller foreign competitors to take advantage of lower tax rates abroad. The U.S. has the highest corporate rate in the developed world, whose average is 25%.”(Editorial, “Reducing Corporate Tax Games,” The Wall Street Journal, 11/29/2017)
“The Senate plan also contains a harsh new rule for new corporate inversions — transactions in which US companies merge with offshore firms to shift their tax addresses offshore. It would hold that any company engaging in an inversion within ten years after enactment would be taxed at 35 per cent — not any lower rates.” (“Multinationals Facing Radical Tax Changes,” The Royal Gazette, 11/14/2017)
“Targeting Inversions: Payments that U.S. companies make to offshore subsidiaries or parent firms for royalties or other costs for sold goods would be taxed... Such payments are currently deductible -- so the tax would erase some of that benefit. … ‘This is a really big deal,’ said Michael Mundaca, co-leader of the Ernst & Young Americas Tax Center and a former top Treasury tax official [during the Obama administration].”(“Tax Bill Takes Extra Bite Of Apple And Other Global Companies,” Bloomberg, 11/3/2017)
FEDERAL RESERVE: “Inversions are undertaken to reduce taxes. This permissible strategy changes the tax jurisdiction and, therefore, the tax rate to that of the new foreign parent. The tax benefit can be substantial because the U.S. corporate tax rate is one of the highest in the world, with a statutory rate of 35 percent.” (“A Look At Corporate Inversions, Inside And Out,” Federal Reserve Bank Of St. Louis, 2017)
Tags:Targeting Inversions, Tax Reform, Corporate Tax Gaming, The Obama AdministrationTo share or post to your site, click on "Post Link". Please mention / link to the ARRA News Service and "Like" Facebook Page - Thanks!
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