Reforming the US Corporate Tax
Author | : Gary Clyde Hufbauer |
Publisher | : Peterson Institute |
Total Pages | : 128 |
Release | : 2005 |
Genre | : Corporations |
ISBN | : 0881325740 |
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Author | : Gary Clyde Hufbauer |
Publisher | : Peterson Institute |
Total Pages | : 128 |
Release | : 2005 |
Genre | : Corporations |
ISBN | : 0881325740 |
Author | : Ruud A. de Mooij |
Publisher | : International Monetary Fund |
Total Pages | : 388 |
Release | : 2021-02-26 |
Genre | : Business & Economics |
ISBN | : 1513511777 |
The book describes the difficulties of the current international corporate income tax system. It starts by describing its origins and how changes, such as the development of multinational enterprises and digitalization have created fundamental problems, not foreseen at its inception. These include tax competition—as governments try to attract tax bases through low tax rates or incentives, and profit shifting, as companies avoid tax by reporting profits in jurisdictions with lower tax rates. The book then discusses solutions, including both evolutionary changes to the current system and fundamental reform options. It covers both reform efforts already under way, for example under the Inclusive Framework at the OECD, and potential radical reform ideas developed by academics.
Author | : Mark P. Keightley |
Publisher | : Createspace Independent Publishing Platform |
Total Pages | : 0 |
Release | : 2012-10-22 |
Genre | : Business & Economics |
ISBN | : 9781480166615 |
Many economists and policymakers believe that the U.S. corporate tax system is in need of reform. There is, however, disagreement over why the corporate tax system needs to be reformed, and what specific policy measures should be included in a reform. To assist policymakers in designing and evaluating corporate tax proposals, this report (1) briefly reviews the current U.S. corporate tax system; (2) discusses economic factors that may be considered in the corporate tax reform debate; and (3) presents corporate tax reform policy options, including a brief discussion of current corporate tax reform proposals. The current U.S. corporate income tax system generally taxes corporate income at a rate of 35%. This tax is applied to income earned domestically and abroad, although taxes on certain income earned abroad can be deferred indefinitely if that income remains overseas. The U.S. corporate tax system also contains a number of deductions, exemptions, deferrals, and tax credits, often referred to as "tax expenditures." Collectively, these provisions reduce the effective tax rate paid by many U.S. corporations below the 35% statutory rate. In 2011, the sum of all corporate tax expenditures was $158.8 billion. The significance of the corporate tax as a federal revenue source has declined over time. At its post-WWII peak in 1952, the corporate tax generated 32.1% of all federal tax revenue. In 2010, the corporate tax accounted for 8.9% of federal tax revenue. The decline in corporate revenues is a combination of decreasing effective tax rates, an increasing fraction of business activity that is being carried out by pass-through entities (particularly partnerships and S corporations, which are not subject to the corporate tax), and a decline in corporate sector profitability. A particular aspect of the corporate tax system that receives substantial attention is the 35% statutory corporate tax rate. Although the U.S. has the world's highest statutory corporate tax rate, the U.S. effective corporate tax rate is similar to the Organization for Economic Co-operation and Development (OECD) average. Further, the U.S. collects less in corporate tax revenue relative to Gross Domestic Production (GDP) (1.9% in 2009) than the average of other OECD countries (2.8% in 2009). This report discusses a number of economic considerations that may be made while evaluating various corporate tax reform proposals. These might include analyses of the likely effect on households of certain reforms (also known as incidence analysis). Policymakers might also want to consider how certain corporate tax provisions contribute to the allocation of economic resources, choosing policies that promote an efficient use of resources. Other goals of corporate tax reform may include designing a system that is simple to comply with and administer, while also promoting competitiveness of U.S. corporations. Commonly discussed corporate tax reforms include policies that would broaden the tax base (i.e., eliminate tax expenditures) to finance reduced corporate tax rates. Concerns that the U.S. corporate tax system inefficiently imposes a "double tax" on corporate income has led some to consider an integration of the corporate and individual tax systems. The treatment of pass-through income-business income not earned by C corporations-has also received considerable attention in tax reform debates. How the U.S. taxes income earned abroad, and the possibility of moving to a territorial tax system, have emerged as important issues. Both the Obama Administration and the House Committee on Ways and Means Chairman David Camp have released tax reform proposals that would change the current tax treatment of U.S. multinationals.
Author | : Martin A. Sullivan |
Publisher | : Apress |
Total Pages | : 180 |
Release | : 2012-02-01 |
Genre | : Business & Economics |
ISBN | : 143023928X |
Corporate tax reform is in the air. Competitive pressures from globalization, as well as skyrocketing budget deficits, are forcing lawmakers to rethink how America’s largest businesses are taxed. Some want to close “loopholes.” Others want to end all U.S. tax on foreign profits. Some want to lower rates, while still others want to abolish the corporate tax altogether and replace it with an entirely new system. Unlike many other books on tax policy, Corporate Tax Reform: Taxing Profits in the 21st Century is not selling an idea or approaching the issue from a particular political slant. It boils down the complexity of corporate taxation into simple language so readers can make up their own minds about the future of this controversial tax. For too long, the issue of corporate tax reform has been the exclusive domain of lawyers and economists who devote their entire adult lives to studying the tax. Corporate Tax Reform: Taxing Profits in the 21st Century opens the door on these issues to all concerned citizens by providing a compact guide to the economics and politics of the current debate on corporate tax reform. Provides an overview of the corporate tax and the possibilities for reform Discusses the impact on businesspeople and individual taxpayers Boils down complex tax concepts boiled into simple language Spurs lively discussion of the political issues without political bias Includes a discussion of ideas for revamping taxes for individuals, since the corporate and individual tax codes are interrelated
Author | : Jason J. Fichtner |
Publisher | : |
Total Pages | : 20 |
Release | : 2005 |
Genre | : |
ISBN | : |
The U.S. corporate tax system is a patchwork of overly complex, inefficient and unfair provisions that impose large costs on corporate business. U.S. corporations seeking to minimize the costs imposed by the detrimental provisions in the U.S. corporate tax system have adopted strategies to reduce overall tax exposure and increase profits. Such strategies include moving operations overseas, corporate inversions, transfer pricing, earnings stripping, and complex leasing arrangements, all to minimize taxation.Debate surrounding the issue of corporate tax reform has lately focused on whether or not the U.S. corporate tax system contributes to structural declines in manufacturing jobs and, more generally, to the weakening competitiveness of U.S. firms in a global economy. Furthermore, it is obvious that many U.S. businesses are conducting costly and complex operations that have minimal economic content but rather seem designed solely to reduce tax exposure.Unless broad and significant corporate tax reforms are enacted, it is likely that U.S. tax competitiveness will continue to suffer. The results of inaction are undesirable: potential loss of American jobs, movement of production overseas, sale of U.S. companies to foreign multinational firms and general erosion of the corporate tax base. This Joint Economic Committee study provides a general overview and discussion of the important economic issues of the U.S. corporate income tax system and provides a primer on several reform options to enhance U.S. tax competitiveness.
Author | : Kimberly Clausing |
Publisher | : International Monetary Fund |
Total Pages | : 47 |
Release | : 2016-09-07 |
Genre | : Business & Economics |
ISBN | : 1475533799 |
This paper examines the main distortions of the U.S. corporate income tax (CIT), focusing on its international aspects, and proposes a set of reforms to alleviate them. A bold reform to replace the CIT with a corporate-level rent tax could induce efficiency-enhancing reform of the international tax system. Since fundamental reform is politically difficult, this paper also proposes an incremental reform that would reduce tax expenditures, reduce the CIT rate to 25-28 percent, and impose a minimum rent tax on foreign earnings. Finally, this paper analyzes empirically the likely impact of the incremental on corporate revenues outside the U.S.: Though a U.S. rate cut would likely lower revenues elsewhere, implementation of a strong minimum tax could more than offset that effect for most countries with effective tax rates above 15 percent.
Author | : Paul Giachetto |
Publisher | : Nova Science Publishers |
Total Pages | : 0 |
Release | : 2013 |
Genre | : Corporations |
ISBN | : 9781626189805 |
Many economists and policy-makers believe that the U.S. corporate tax system is in need of reform. There is, however, disagreement over why the corporate tax system needs to be reformed, and what specific policy measures should be included in a reform. To assist policy-makers in designing and evaluating corporate tax proposals, this book reviews the current U.S. corporate tax system; discusses economic factors that may be considered in the corporate tax reform debate; and presents corporate tax reform policy options, including a brief discussion of current corporate tax reform proposals. The current U.S. corporate income tax system generally taxes corporate income at a rate of 35%. This tax is applied to income earned domestically and abroad, although taxes on certain income earned abroad can be deferred indefinitely if that income remains overseas. The U.S. corporate tax system also contains a number of deductions, exemptions, deferrals, and tax credits, often referred to as tax expenditures. Collectively, these provisions reduce the effective tax rate paid by many U.S. corporations below the 35% statutory rate. In 2011, the sum of all corporate tax expenditures was $158.8 billion.
Author | : Christopher H. Hanna |
Publisher | : |
Total Pages | : 0 |
Release | : 2016 |
Genre | : |
ISBN | : |
In the last few years, academics, practitioners and government officials have engaged in serious discussions in reforming the U.S. corporate income tax system. Some, if not much of the discussion, has focused on maintaining the competitiveness of U.S. corporations in a global economy. As a result, some have argued that the U.S. needs to reduce its top corporate tax rate from 35 percent, which is currently among the highest of the 30 OECD countries, to a rate around 30 percent or even lower. Others have maintained that the U.S. needs to enact specific or targeted tax incentives, such as expensing of all equipment purchases. In discussing reform of the U.S. corporate income tax system, one aspect of reform seems to be consistently overlooked, ignored or marginalized: the impact reform will have on the financial statements of the Fortune 500 companies and other publicly held corporations, which I focus on and refer to as “Corporate America.” In Corporate America, the overwhelming emphasis is on a corporation's net income, earnings per share (EPS) and effective tax rate. The different types of corporate tax reform may have a significantly differently impact on a corporation's net income, EPS and effective tax rate. Consequently, because of Corporate America's focus on net income, EPS and the effective tax rate, the effectiveness of the various types of corporate tax reform may be greatly impacted by the form. For example, if economists agree that a directed tax preference is needed to stimulate economic expansion, the form of the tax preference and its impact on Corporate America's financial statements may significantly affect the effectiveness of the tax preference. As a result, in determining the form of corporate tax reform, whether major or minor reform, it is critical to look at the impact on Corporate America's financial statements.
Author | : Albert Ando |
Publisher | : MIT Press (MA) |
Total Pages | : 268 |
Release | : 1985 |
Genre | : Business & Economics |
ISBN | : 9780262010863 |
Where the US tax system stands today, how it evolved, and how it should be changed.
Author | : United States. Congress. Senate. Committee on Small Business |
Publisher | : |
Total Pages | : 822 |
Release | : 1985 |
Genre | : |
ISBN | : |