Interesting article. Neglects to mention that the Obama administration wants to make the changes retroactively. This article should be read along with the following Robert Wood article.
The health of a country is a function (in part) of the health of it’s tax system. The U.S. tax system is unbelievably out of touch with the reality of the modern world. It has reached the point where the rest of the world should take note and encourage U.S. tax reform.
As this article points out:
The U.S. is one sick puppy.
If anyone is responsible for tax avoidance, it is an interventionist government that is micro-managing an economy
You know a government must be starving for funds when it starts identifying taxation as a form of “economic patriotism.” That is what U.S. Treasury Jacob Lew said when he urged Congress to pass legislation to curb U.S. corporations moving their residence abroad to avoid paying federal corporate taxes.
I remember attending a conference a decade ago when economists had trouble understanding why corporate taxes as a share of GDP were much greater in Japan than most countries – by as much as 6% in 1991. It was a puzzle since Japan had the world’s highest general corporate income tax rate, which should have incented Japanese companies to shift profits to low-tax jurisdictions, shrinking both corporate income and taxes as a share of GDP, something akin to the U.S. today. The explanation at the…
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