Posted on 11/18/2015 4:33:33 PM PST by markomalley
Treasury Secretary Jack Lew told members of Congress Wednesday that he will announce a new administrative effort this week to stop corporate inversions, as attempts at legislation to stop companies from moving their headquarters out of the U.S. have failed.
Lew said in a letter to lawmakers that he would issue "additional targeted guidance to deter and reduce further the economic benefits of corporate inversions."
Lew first took action to undercut the tax benefits of inversions in September 2014, announcing several specific rules meant to prevent companies from moving their headquarters abroad for tax purposes and limiting the tax breaks they could reap if they were successful in moving out of the country.
Wednesday's letter did not indicate what further efforts the Treasury could take.
Lew cautioned that only legislation could fully stop inversions, which are tax maneuvers in which U.S. companies merge with businesses in low-tax countries and then place the new headquarters of the combined company in the low-tax jurisdiction.
But he said that he had a mandate to take whatever administrative action he could to limit companies' ability to undertake inversions. By moving their headquarters out of the U.S., he said, they avoid taxes but still enjoy the benefits of operating in America, "such as our rule of law, our skilled workforce, our infrastructure and our world-class research and development capabilities."
Last year's announcement was sufficient to cause some companies to call off their inversions. But it hasn't completely stemmed the flow. In October, pharmaceutical giant Pfizer announced that it was in talks with Ireland-based Allergan about combining.
"Creative accountants and lawyers will continue to find new ways for companies to move their tax residences overseas and avoid paying taxes here at home," Lew warned.
Rep. Sander Levin of Michigan, the ranking Democrat on the House Ways and Means Committee, welcomed Lew's announcement.
"The fact that American companies, including Pfizer, continue to pursue inversions makes clear that additional steps are needed to stop this trend," Levin said. "I am encouraged that Treasury intends to take additional steps to curb tax inversions, but also recognize that their authority in this area is not unlimited — as Secretary Lew noted today. Congress should get off the sidelines and take action to change the law to stop these tax-motivated inversions."
Oh cmon...lowering taxes and regulations would solve the problem. ..
ping
Replaced our company car this weekend. Costs included sales/excise tax, documentary fee, dealer’s inventory tax, federal government title fee, state title fee, government license and registration fee, stadium tax, federal EPA certification fee and two other taxes. Everybody seems to want a piece of the pie.
Do you work in the private sector, or one of the many government enclaves that so-called “conservatives” work and pontificate from?
Why should a company sit idly by while the government sucks every dollar from it, when they can make more money utilizing a different corporate structure, legally available to it?
If the government wants to stop inversions, cut the federal budget, fire government employees, lower taxes.
Do you seriously think more government can impose the conditions in which companies will find manufacturing things in America beneficial?
“Actually in a world with supercomputers on desktops it is very simple. Any profits earned in the US are taxed in the US (overhead, administrative costs, etc. are allocated to the country where headquartered). If it is produced outside of the US and sold in the US there is an import tariff.”
Says somebody who has probably drawn a government check his entire life, and surely has never run a business and hired an employee.
“Everybody seems to want a piece of the pie.”
That is exactly right. The government, and a disturbing number of posters on this thread don’t seem to get it. The government wants a stationary target from which to extract taxes, as your post ably points out.
I have been in the private sector, for the last twenty years, with one company.
I actually gave notice last week, and will be leaving my current job next week.
The company has been exporting jobs to South America, now for over ten years. Maybe even 15 years. It is a huge, global company. Very large. The job situation is now no longer viable for me here though.
Maybe I am biased, because of the job I have had. It has been brutal - I was laid off a year ago because my job at that time was sent south, I managed to relocate to another office with the same company then, but now in my mind, I ended up being badly over-managed.
It had become simply intolerable. It is very frustrating, because I thought I was doing a fine job.
But I finally gave up. Could be I am just fed-up, but I really, really, really think Americans need to be much more focused on American jobs.
Far more, than we currently are. American jobs, for American workers.
Nobody, anywhere, is backing them anymore.
Which is probably why now 94,000,000 Americans, are now not employed.
Ninety four million.
Ching-ching!
Wasn’t it something along the lines Directive 10-289?
Point Two. All industrial, commercial, manufacturing and business establishments of any nature whatsoever shall henceforth remain in operation, and the owners of such establishments shall not quit nor leave nor retire, nor close, sell or transfer their business, under penalty of the nationalization of their establishment and of any and all of their property.
Point Two. All industrial, commercial, manufacturing and business establishments of any nature whatsoever shall henceforth remain in operation, and the owners of such establishments shall not quit nor leave nor retire, nor close, sell or transfer their business, under penalty of the nationalization of their establishment and of any and all of their property.
“Far more, than we currently are. American jobs, for American workers.”
What Obama wants, and the GOPe seems to agree with is nothing more than turning the US into a concentration camp for unfortunate businesses.
Why do you think your company exported jobs to South America?
Do you think it was because of labor? Maybe it was icing on the cake, but the real reason is regulations, taxes of all kinds, and a hostile government environment.
I’m sorry to hear you are raw about this, I completely understand the sentiment, but a slogan “American Jobs for American Workers” means one thing under Obama & todays Republican leadership, and it means another thing to someone who actually seeks to grow business and opportunity for American workers.
Don’t be mad at your company, be pissed off at government at all levels for making it so attractive to move work offshore in comparison to the US that it’s a viable alternative.
Of course, they could just eliminate taxes on overseas income, bringing the US in line with most other countries, but that would be too easy.
But then again, that would take an act of Congress.
Let’s see. Your I-Phone is manufactured in China using the local slave labor (Americans are too stupid to be able to manufacture a phone) and the software for the I-Phone is designed and written by H1-B employees from India, Pakistan, etc. (Americans with design, code, QA, etc. degrees can be gainfully employed at Burger King) and the I-Phones are sold here in the US as US products??????
Iphones are manufactured on K-street by lobbyists.
Apple has used their clout to get whatever they want. Ultimate cronies. I wonder though how much it would cost to run a similar manufacturing plant in the US as used in China.
Most business isn’t in the crony business with DC. They are doing what they have to in order to survive.
Lower taxes, ease regulations and they’ll expand in the US and hire Americans.
I’m not mad at my company. They have been good to me. I am very supportive of them.
I am however strongly, for Trump.
Strongly so. He seems to be the only candidate, in either party by the way, who seems to get this issue.
He is all alone, and he is STRONGLY saying we have sold out America for long enough.
I completely agree. 100%.
Go Trump.
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