Check out this article from the Wall Street Journal.
The following is of particular interest:
The new budget also would lower the top corporate tax rate to 25% from 35% and plunge into the debate about how to tax companies’ overseas operations. U.S. companies now pay the tax rate of the country where the outpost is located and then, if they bring those profits home, often pay some U.S. taxes as well. Under the Ryan-Camp proposal, companies essentially would pay just the tax rate of the country where the profits are earned.
Republicans say the current system unfairly taxes corporations twice, hurts their competitiveness and discourages them from reinvesting in the U.S. The budget plan doesn’t specify a tax rate for foreign earnings brought back to the U.S., but some Republicans previously have suggested exempting 95% of future foreign earnings from U.S. corporate tax and imposing a 5.25% tax on existing overseas earnings. Critics say such a move would prompt American firms to avoid taxes by moving operations overseas even faster than they already are, harming American workers and reducing investment in the U.S.
The proposal is one of “territorial based taxation”. If “territorial based taxation” is right for corporations, then why not for individuals?
People ARE corporations… geez.
Exactly. Probably too much to hope for though.
I suspect as minnows, we’re just not important enough. The US government seems to care far more about big business than small fry.
I listened to the Queen’s speech yesterday in Westminter Hall where Parliament was so graciously addressed and thanked for a lovely new window they’d gifted to Her Majesty showing her royal coat of arms. I thought what a contrast to over the pond where government seems self-serving or focussed on its special interest groups. My grandfather had been one of these congressional lobbyists while my other grandfather had served for six years as Chief Judge of the US Tax Court. Douglas Shulman will probably have heard of him even though he died almost thirty years ago. Though he had a reputation for being slightly pro-government, he’d be rolling in his grave over this fiasco.
Does the US really make enough from us to merit the huge fox hunt that they are putting together? If you were to take away the FBAR penalties and FATCA withholding and be left with the situation that existed 5 years’ ago, how much revenue were they really extracting from US persons overseas? It couldn’t have been much considering the laughable compliance rate.
I bet that they’re rubbing their hands in glee though at the prospect of stealing millions or even billions through unjust FBAR penalties and FATCA fines starting next year once they start to root out the 95% of “US persons” overseas who had no idea what is going on. Its disgraceful.