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Reform to Repatriate?

Rumblings of rational reform of our corporate tax code, including how we handle foreign earnings:

As the Senate Finance Committee’s draft proposals suggest, the US should jettison its worldwide approach to corporate taxation and adopt a territorial system for taxing US MNCs’ foreign earnings. Such a system would provide a level playing field that supports US MNCs’ global competitiveness. It would also eliminate the efficiency costs of deferral and boost US MNCs’ repatriation of foreign earnings, with significant benefits for output and employment.

As Rep. Davd Camp points out, the worldwide tax system may have made sense when we were 50% of the world’s GDP and had no serious competitors.  Now, it’s just hurting everyone.

Posted in Economics.