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How to Stop Turning U.S. Corporations into Tax Exiles

nytimes.com

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Re: How to Stop Turning U.S. Corporations into Tax Exiles

#21

Post by icebraining »

cmdkeen wrote: post #5
leereeves wrote: post #3

> Congressional leaders agree that passing legislation according to [the Schumer-Portman] framework would stop inversions Until another country offers an even better tax deal to attract multi-national corporations.

Not really - there are benefits to being based in the US. If everyone just chased the lowest taxed jurisdictions then every corporation would be based in a tax haven. Corporations aren't repatriating the money they hold offshore. I can see why the US wants a piece of that pie, but they currently aren't getting any pie and are losing piemakers. Taking a smaller cut of something whilst also having that something flow b…

> Corporations aren't repatriating the money they hold offshore.

Indirectly, they are: "Nearly Half of So-Called “Offshore” Funds Already in the United States"

Earlier this year, a survey was sent to 27 U.S. multinational corporations and found they held more than half a trillion dollars in tax-deferred foreign earnings at the end of FY2010. The survey also found that 46% of those foreign earnings – almost $250 billion – was maintained in U.S. bank accounts or invested in U.S. assets such as U.S. Treasuries, U.S. stocks other than their own, U.S. bonds, or U.S. mutual funds.

https://www.hsgac.senate.gov/subcommittees/investigations/me...

Re: How to Stop Turning U.S. Corporations into Tax Exiles

#22

Post by lazyjones »

mschuster91 wrote: post #19
pzone wrote: post #6

Earlier quoted context omitted.

No, actually what you're saying is a pile of crap. The only irresponsible ones in this situation are the members of Congress. The United States is not immune to economic forces, yet for years despite all the evidence to the contrary they've been in utter denial about this. All they have to do is pass a simple bill to make the US tax code work the same way as it does in every other god damn country in the world, then…

> No, actually what you're saying is a pile of crap. In Germany, our constitution says in §14.2: "Eigentum verpflichtet. Sein Gebrauch soll zugleich dem Wohle der Allgemeinheit dienen.", translated roughly to "Ownership creates duties. Its use shall be for common welfare." For me, looks like the failure is in the US constitution which does not focus on the common good.

> In Germany, our constitution says in §14.2: "Eigentum verpflichtet.

You can tax the property of people without taxing corporations. The former can be done with reasonable effort and effectiveness because the location of someone and their home's can be determined. Taxing corporations has proven unreliable and ineffective because they're often just a mailbox in s tax haven and profits are moved to other entities easily (via licensing fees etc.). There's also no real need to tax them, as you can tax their owners.

Re: How to Stop Turning U.S. Corporations into Tax Exiles

#23

Post by pzone »

princeb wrote: post #18

I am trying to think of companies that should rightfully repatriate cash back to the states, and companies that should not. Why is it that it is repulsive that Google or Apple chooses to keep their cash overseas, whereas it is fine for Budweiser to do so (ignoring magnitudes for a second)? Because AB Inbev is Belgian? This is a difficult example for me to think of, because the US is one of the interesting countries w…

If these tax laws incentivize productivity-destroying mergers then they are utterly moronic, immoral even. The Pfizer CEO said he wouldn't do it but for the tax savings.

All these companies want to do is bring back their cash to the US and pay their US shareholders. It's fair and defensible for Pomme to want to bring cash to France to pay its French shareholders, and for Apfel to bring it to Germany to pay its German shareholders.

Re: How to Stop Turning U.S. Corporations into Tax Exiles

#24

Post by [deleted] »

princeb wrote: post #18

I am trying to think of companies that should rightfully repatriate cash back to the states, and companies that should not. Why is it that it is repulsive that Google or Apple chooses to keep their cash overseas, whereas it is fine for Budweiser to do so (ignoring magnitudes for a second)? Because AB Inbev is Belgian? This is a difficult example for me to think of, because the US is one of the interesting countries w…

[deleted]

Re: How to Stop Turning U.S. Corporations into Tax Exiles

#25

Post by DominikR »

mschuster91 wrote: post #19
pzone wrote: post #6

Earlier quoted context omitted.

No, actually what you're saying is a pile of crap. The only irresponsible ones in this situation are the members of Congress. The United States is not immune to economic forces, yet for years despite all the evidence to the contrary they've been in utter denial about this. All they have to do is pass a simple bill to make the US tax code work the same way as it does in every other god damn country in the world, then…

> No, actually what you're saying is a pile of crap. In Germany, our constitution says in §14.2: "Eigentum verpflichtet. Sein Gebrauch soll zugleich dem Wohle der Allgemeinheit dienen.", translated roughly to "Ownership creates duties. Its use shall be for common welfare." For me, looks like the failure is in the US constitution which does not focus on the common good.

How on earth can this be a law? This is such a broad and general statement that it could be used for whatever reasons to confiscate private property.

Re: How to Stop Turning U.S. Corporations into Tax Exiles

#26

Post by pzone »

lazyjones wrote: post #22
mschuster91 wrote: post #19

Earlier quoted context omitted.

> No, actually what you're saying is a pile of crap. In Germany, our constitution says in §14.2: "Eigentum verpflichtet. Sein Gebrauch soll zugleich dem Wohle der Allgemeinheit dienen.", translated roughly to "Ownership creates duties. Its use shall be for common welfare." For me, looks like the failure is in the US constitution which does not focus on the common good.

> In Germany, our constitution says in §14.2: "Eigentum verpflichtet. You can tax the property of people without taxing corporations. The former can be done with reasonable effort and effectiveness because the location of someone and their home's can be determined. Taxing corporations has proven unreliable and ineffective because they're often just a mailbox in s tax haven and profits are moved to other entities easi…

Yes. I would even argue that advancing the common good includes a mandate not to pass unenforceable welfare-destroying tax laws.

Re: How to Stop Turning U.S. Corporations into Tax Exiles

#27

Post by DominikR »

lazyjones wrote: post #22
mschuster91 wrote: post #19

Earlier quoted context omitted.

> No, actually what you're saying is a pile of crap. In Germany, our constitution says in §14.2: "Eigentum verpflichtet. Sein Gebrauch soll zugleich dem Wohle der Allgemeinheit dienen.", translated roughly to "Ownership creates duties. Its use shall be for common welfare." For me, looks like the failure is in the US constitution which does not focus on the common good.

> In Germany, our constitution says in §14.2: "Eigentum verpflichtet. You can tax the property of people without taxing corporations. The former can be done with reasonable effort and effectiveness because the location of someone and their home's can be determined. Taxing corporations has proven unreliable and ineffective because they're often just a mailbox in s tax haven and profits are moved to other entities easi…

Fully agree, if the state did not tax corporations they could work near maximum efficiency if correctly managed, while the state still could get his share whenever an owner extracts a part of the profits for private use.

Re: How to Stop Turning U.S. Corporations into Tax Exiles

#28

Post by mschuster91 »

DominikR wrote: post #27
lazyjones wrote: post #22

Earlier quoted context omitted.

> In Germany, our constitution says in §14.2: "Eigentum verpflichtet. You can tax the property of people without taxing corporations. The former can be done with reasonable effort and effectiveness because the location of someone and their home's can be determined. Taxing corporations has proven unreliable and ineffective because they're often just a mailbox in s tax haven and profits are moved to other entities easi…

Fully agree, if the state did not tax corporations they could work near maximum efficiency if correctly managed, while the state still could get his share whenever an owner extracts a part of the profits for private use.

> while the state still could get his share whenever an owner extracts a part of the profits for private use

The problem is: this won't happen, as people by nature are too greedy. They will spend the minimum until someone finds a tax loophole and then in a rush all the money is gone and untaxable.

Re: How to Stop Turning U.S. Corporations into Tax Exiles

#29

Post by lazyjones »

pzone wrote: post #11
adventured wrote: post #2

For reference, statutory corporate tax rates by country (PDF): https://www2.deloitte.com/content/dam/Deloitte/global/Docume...

Important part: middle column, where the rate is basically 0% everywhere except the US, where it is 30%.

Why is this the important part? It's not 0% in Austria as listed, it varies too (in Vienna you pay tax for subway infrastructure, among other things). It's the sum that matters, including exploitable loopholes such as trusts and holdings (AFAIK, in Switzerland, a pure holding pays no corporate taxes).

Re: How to Stop Turning U.S. Corporations into Tax Exiles

#30

Post by rmc »

apsec112 wrote: post #10
brandelune wrote: post #4

Such a pile of crap, by Icahn, of course. Corporations do not exist in a vacuum of social irresponsibility and their first duty is certainly not to their shareholders but to the people they employ and to the societies they thrive on.

"Any one may so arrange his affairs that his taxes shall be as low as possible; he is not bound to choose that pattern which will best pay the Treasury; there is not even a patriotic duty to increase one's taxes." "Over and over again courts have said that there is nothing sinister in so arranging one's affairs as to keep taxes as low as possible. Everybody does so, rich or poor; and all do right, for nobody owes any…

There's no legal responsibility on me to be nice to my elderly parents either. Doesn't mean it's not The Right Thing To Do.
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