free beer for all!!
Posted on 02/02/2015 9:43:06 AM PST by SeekAndFind
President Barack Obama will propose raising $238bn by levying a one-off tax on the cash piles held by US companies overseas to repair the US’s crumbling roads and bridges.
The measure, a key plank of the US president’s budget to be outlined on Monday, would impose a 14 per cent “transition” tax on the estimated $2tn in earnings US companies have amassed overseas, the White House said on Sunday.
Critics say the existing offshore cash mountains testify to the aggressive foreign tax planning by US companies, while businesses cite them as evidence of the handicaps they face under an uncompetitive US tax regime.
Mr Obama will also propose a 19 per cent tax on future foreign earnings, giving companies a credit on foreign taxes and allowing them to be reinvested in the US with no additional penalty. Under the current system, US companies pay little or no tax on their earnings abroad until they are brought back into the US.
The money raised would be used to fund about half of an ambitious six-year programme of highway, bridge and transit upgrades, one of the president’s main priorities during his final two years in office and an initiative that has attracted some degree of bipartisan support. The remainder of the programme would be financed by the existing highway fund.
“This transition tax would mean that companies have to pay US tax right now on the $2tn they already have overseas, rather than being able to delay paying any US tax indefinitely,” a White House official said.
(Excerpt) Read more at ft.com ...
And the liberals wonder why companies keep moving off shore.
US tax code encourages capital flight. So, corporations do just that, effectively wasting a mountain of money on lawyers and tax schemes in the process.
This is just like broken windows fallacy... If you read the news, you may have noticed that journalists and politicians often like to point out that natural disasters, wars, and other destructive events can boost an economy’s production because they create demand for rebuilding work.
In the case of Obama, he simply replaces disasters with his own brand of destruction -— COMPLICATED TAX SCHEMES that cause corporations to divert money from profitable pursuits towards navigating the tax code.
Then, US corporate profits sit abroad, waiting for repatriation holidays which inevitably come every time there is an economic slowdown.
The initial problem is US corporate tax rates are too high. Why not cut them to a competitive rate ( better still, ZERO ). Were that to happen, instead of US businesses sheltering money overseas, foreign corporations would setup offices in the US, moving as much here as they can.
I believe growth in economic activity would far outweigh any lost revenue.
But no one is proposing that at all...
US tax code encourages capital flight. So, corporations do just that, effectively wasting a mountain of money on lawyers and tax schemes in the process.
This is just like broken windows fallacy... If you read the news, you may have noticed that journalists and politicians often like to point out that natural disasters, wars, and other destructive events can boost an economy’s production because they create demand for rebuilding work.
In the case of Obama, he simply replaces disasters with his own brand of destruction -— COMPLICATED TAX SCHEMES that cause corporations to divert money from profitable pursuits towards navigating the tax code.
Then, US corporate profits sit abroad, waiting for repatriation holidays which inevitably come every time there is an economic slowdown.
The initial problem is US corporate tax rates are too high. Why not cut them to a competitive rate ( better still, ZERO ). Were that to happen, instead of US businesses sheltering money overseas, foreign corporations would setup offices in the US, moving as much here as they can.
I believe growth in economic activity would far outweigh any lost revenue.
But no one is proposing that at all...
Would this force corporations to move completely overseas?
Can you imagine the stimulus a good portion of that 2 Trillion bucks coming home because of improved opportunities would provide?
Mind boggling. But, as Obama would say, “Is it fair?”
Wait until the other countries retaliate.
This is another DOA plan by obozo that is just there to give him an extreme liberal legacy (”hey, I tried”) while pissing everyone who actually generates capital off.
It is a gift to the GOP and should be tossed onto the stack for the 2016 POTUS candidate.
Following Al Sharpton's guidance.
RE: Following Al Sharpton’s guidance.
Ahh yes, the man who still hasn’t paid 4 million dollars in back taxes, and who’s still free as of this writing.
If these a-holes in DC hadn’t LOOTED these funds (Highway Trust, Social Security, etc.) to BUY VOTES and ship billions of it to nations that hate us so they can repay the loans the international banksters advanced and we underwrote to protect their asses, etc.), there would be plenty of “money” in Malfunction Junction for all of the “necessary and proper” functions of government.
And if you don’t know why “money” is in quotes, you don’t understand the intent of the Founders expressed at Art.1, Sect.10 and I’d urge you to get up to speed on it.
but needs the Big Al Capone treatment.
So how many more American corporations are you going to see doing an “inversion” before any changes to the tax code like Obama is requesting?
He can plan it all he likes, this would never clear the House, not even under Bone-head.
A few things jump out at me:
1. If the money collected on the gasoline was only used for roads and bridges, there wouldn’t be an infrastructure problem.
2. We have no king. Only congress can raise taxes. (Let’s hope the GOP doesn’t wimp out.)
It’s all about 2016.
Low-infos are gonna love this idea. They’ll get mad at GRRREEEEDY Corporations for “hiding piles of cash offshore”, and even madder at Republicans for not going after it. Politically astute if economically suicide.
Luckily, I lost my Pile-O-Overseas-Cash in a boating accident, along with my guns, ammo and precious metals.
That one NEVER gets old! :)
Wait a minute, I thought that was the purpose of the American Recovery and Reinvestment Act of 2009, AKA, the Stimulus Bill?
RE: Wait a minute, I thought that was the purpose of the American Recovery and Reinvestment Act of 2009, AKA, the Stimulus Bill?
______________________________
Government’s view of the economy could be summed up in a few short phrases: If it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidize it.
Ronald Reagan
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.