Far and away the biggest complaint that Americans have with the tax system, poll after poll finds, is that big corporations don’t pay their fair share. So it’s more than a little startling that the tax bill Republicans are about to pass would not only slash the corporate tax rate across the board but also add a big incentive for companies to stash money overseas.
The bill would take currently untaxed profits of US companies being stored abroad — profits that would normally be taxed at a 35 percent rate upon being brought back to the US — and tax them at new ultra-low rates: 8 percent for profits invested in real estate and other hard assets abroad, and 15.5 percent for profits in cash and stock and other liquid assets.
This isn’t an exclusively Republican idea. Liberals like former Sen. Barbara Boxer (D-CA), President Obama, and Senate Democratic Leader Chuck Schumer have all endorsed proposals that would give companies that stashed money overseas a big tax break.
We tried one part of the GOP tax bill in 2004. It was a huge failure.