[Your Nightmare]

Yes, and think of the incentive to corporate relocation to here that is offered by Sec. 905 of the FairTax bill!!

You mean the one that says the FairTax is an income tax for foreign entities? That's a lot of incentive to relocate.

Fool.

[groanup]

You mean the one that says the FairTax is an income tax for foreign entities? That's a lot of incentive to relocate.

I take it he's saying that the incentive would be to become a domestic corporation.

[ancient_geezer]

You mean the one that says the FairTax is an income tax for foreign entities? That's a lot of incentive to relocate.

Seems to me I remember that Conservative Goddess has weight in on this providing some insights on this provision in past threads. Perhaps she can weigh in here on those issues.

Facing a 23% tax on income earned in the United States by foreign Corporations would appear to be an excellent incentive for said corporations to relocate headquarters and manufacturing to the U.S. where they are not subject to such a tax.

I note it also provides an out in paragraph(c) providing a strong invitation for foreign governments to enter bilateral tax treaties with the U.S. that can provide protection of our corporations and business interests operating under the jurisdictions of their countries in return for lower tax rates and protections extended to their businesses operating here.

 

H.R.25

Fair Tax Act of 2005 (Introduced in House)
http://thomas.loc.gov/cgi-bin/query/z?c109:H.R.25:

---

 

`SEC. 905. WITHHOLDING OF TAX ON NONRESIDENT ALIENS AND FOREIGN CORPORATIONS.

• `(a) In General- All persons, in whatever capacity acting (including lessees or mortgagors or real or personal property, fiduciaries, employers, and all officers and employees of the United States) having control, receipt, custody, disposal, or payment of any income to the extent such income constitutes gross income from sources within the United States of any nonresident alien individual, foreign partnership, or foreign corporation shall deduct and withhold from that income a tax equal to 23 percent thereof.

• `(b) Exception- No tax shall be required to be deducted from interest on portfolio debt investments.

• `(c) Treaty Countries- In the case of payments to nonresident alien individuals, foreign partnerships, or foreign corporations that have a residence in (or the nationality of a country) that has entered into a tax treaty with the United States, then the rate of withholding tax prescribed by the treaty shall govern.'.

[pigdog]

Once again, you miss the point ... certainly the descriptuion you use applies to one of us.

I'll leave it to the readers of the post to decide which is which ...