Corporate tax “patriotism” mandate moves into high gear

[Mr. Big Dog 10,747]

Yeah that's what they do now basically. I think the Foreign Earned Income Exclusion is about $108k fro 2014. There's the other matter of opening bank accounts for USCs as well now. With all this FACTA and FBAR business, a lot of them don't even want to deal with Americans.

But really what are you paying taxes for, besides a passport, if you don't live in the U.S.? Running around bragging that you're an American doesn't have the glamor it used to. In fact, it can get you killed in some places.

I think "corporate people" have a lot more than 100K exempted from US taxes. Maybe I should have said corporate "people" instead?

[Karee 4,191]

I think "corporate people" have a lot more than 100K exempted from US taxes. Maybe I should have said corporate "people" instead?

I wonder if other countries have tax exemptions for foreign companies. I suspect they do. Seems the U.S. will need to start using the same tax rules as other countries if they want to stay competitive. There's talk by the new Thai govt. of tying their exchange rate to the Chinese currency. At this point in time, it's silly talk, but in a few years who knows?

[The Nature Boy 4,224]

I'd be okay with cutting "corporation people" a little slack on the first 100K of their earnings.

Thats so un librul of you .. shame LOL

So you don't know what you're talking about as usual. Thanks for playing. Go fetch: http://www.visajourney.com/forums/topic/457007-postcount-game-take-2/

I am still waiting to here how simple it is

[Mr. Big Dog 10,747]

I wonder if other countries have tax exemptions for foreign companies. I suspect they do. Seems the U.S. will need to start using the same tax rules as other countries if they want to stay competitive. There's talk by the new Thai govt. of tying their exchange rate to the Chinese currency. At this point in time, it's silly talk, but in a few years who knows?

Norther European countries have some of strictest regulations and highest labor costs. And yet, they are huge net exporters - i.e. they are very competitive in this world economy. There's more to competitiveness than low wages, low regulations and low taxes. Once America acknowledges this simple truth and translates it into the proper education and economic policies, it may actually stand a chance to become competitive in this world once again as well. Until then, we'll be on the decline which is also known as the race to the bottom.

Edited July 29, 2014 by Mr. Big Dog

[Karee 4,191]

Norther European countries have some of strictest regulations and highest labor costs. And yet, they are huge net exporters - i.e. they are very competitive in this world economy. There's more to competitiveness than low wages, low regulations and low taxes. Once America acknowledges this simple truth and translates it into the proper education and economic policies, it may actually stand a chance to become competitive in this world once again as well. Until then, we'll be on the decline which is also known as the race to the bottom.

But do these northern European countries tax their citizens who have residence in other countries?

[Mr. Big Dog 10,747]

But do these northern European countries tax their citizens who have residence in other countries?

Why does that matter in terms of global economic competitiveness?

[JohnR! 5,495]

Why does that matter in terms of global economic competitiveness?

It doesn't matter at all...

[Karee 4,191]

Why does that matter in terms of global economic competitiveness?

I'm just curious. It is the subject of the thread. I don't see how it makes the U.S. more competitive. People shouldn't have to pay taxes to a country where they don't reside.

It doesn't matter at all...

Thanks for your well thought out contribution to the thread.

[Mr. Big Dog 10,747]

I'm just curious. It is the subject of the thread. I don't see how it makes the U.S. more competitive. People shouldn't have to pay taxes to a country where they don't reside.

It makes the US neither more nor less competitive. That said, the fact is that your average John Doe can move overseas and not pay a dime worth of US taxes. The exemption, after all, is more than twice the average US household income.

[JohnR! 5,495]

It makes the US neither more nor less competitive. That said, the fact is that your average John Doe can move overseas and not pay a dime worth of US taxes. The exemption, after all, is more than twice the average US household income.

Political stability trumps tax every day of the week and twice on Sundays, and that is what places the US in the top of competitive places for corporations. At the end of the day, moving a corporation abroad must take into account the political environment of the host country, be it politics or infrastructure. If taxes alone were the deciding factor, each mega corporation in the world would buy a country somewhere and set shop. As it happens for some it is easier to set shop in America where there is an abundance of talent, our infrastructure is focused on service and it is easy to get raw materials in and out of the country.

[The Nature Boy 4,224]

Political stability trumps tax every day of the week and twice on Sundays, and that is what places the US in the top of competitive places for corporations. At the end of the day, moving a corporation abroad must take into account the political environment of the host country, be it politics or infrastructure. If taxes alone were the deciding factor, each mega corporation in the world would buy a country somewhere and set shop. As it happens for some it is easier to set shop in America where there is an abundance of talent, our infrastructure is focused on service and it is easy to get raw materials in and out of the country.

More of your ridiculous rambling based on nothing,

U.S. Firms Move Abroad to Cut Taxes

Despite '04 Law, Companies Reincorporate Overseas, Saving Big Sums on Taxes

http://online.wsj.com/news/articles/SB10000872396390444230504577615232602107536

More big U.S. companies are reincorporating abroad despite a 2004 federal law that sought to curb the practice. One big reason: Taxes.

Companies cite various reasons for moving, including expanding their operations and their geographic reach. But tax bills remain a primary concern. A few cite worries that U.S. taxes will rise in the future, especially if Washington revamps the tax code next year to shrink the federal budget deficit.

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"We want to be closer to where our clients are," says David Prosperi, a spokesman for risk manager Aon aon +1.25% plc, which relocated to the U.K. in April.

Aon has told analysts it expects to reduce its tax rate, which averaged 28% over the past five years, by five percentage points over time, which could boost profits by about $100 million annually.

Since 2009, at least 10 U.S. public companies have moved their incorporation address abroad or announced plans to do so, including six in the last year or so, according to a Wall Street Journal analysis of company filings and statements. That's up from just a handful from 2004 through 2008.

Journal Community

The companies that have moved recently include manufacturer Eaton Corp. ETN -0.93% , oil firms Ensco International Inc. ESV -1.41% and Rowan RDC -0.96% Cos., as well as a spinoff of Sara Lee Corp. called D.E. Master Blenders 1753.

Eaton, a 101-year-old Cleveland-based maker of components and electrical equipment, announced in May that it would acquire Cooper Industries PLC, another electrical-equipment maker that had moved to Bermuda in 2002 and then to Ireland in 2009. It plans to maintain factories, offices and other operations in the U.S. while moving its place of incorporation—for now—to the office of an Irish law firm in downtown Dublin.

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Eaton plans to maintain factories and offices in the U.S. Associated Press

More

Island Tax Haven Roils India's Ways

When Eaton announced the deal, it emphasized the synergies the two companies would generate. It also told analysts that the tax benefits would save the company about $160 million a year, beginning next year.

Eaton's chief executive, Alexander Cutler, has been a vocal critic of the corporate tax code. "We have too high a domestic rate and we have a thoroughly uncompetitive international tax regime," Mr. Cutler said on CNBC in January. "Let's not wait for the next presidential election" to change the rules.

The moves by Ensco and Rowan, which operate offshore oil rigs, show how one company's effort to lower its tax rate can spur other shifts.

In moving from Dallas to the U.K. in 2009, Ensco followed rivals such as Transocean Ltd. RIG -1.40% , Noble Corp. and Weatherford International Ltd. WFT -0.87% that had relocated outside the U.S. The company said the move would help it achieve "a tax rate comparable to that of some of Ensco's global competitors."

In fact, Ensco's tax rate has declined. In the second quarter, the company said its "effective tax rate" was 10.5%, down from 19% in 2009. The savings: more than $100 million a year.

Around the time of Ensco's move, Rowan executives fielded questions from investors and analysts about their own tax rate. In February, Rowan answered the questions, announcing plans to move to the U.K. from Houston. "We're able to be competitive, with a low effective rate," says Suzanne Spera, the firm's director of investor relations.

Fear of such moves is what prompted Congress to pass the 2004 law, which was backed by Democrats and some Republicans and included exceptions that some firms and advisers have sought to exploit.

In June, the Internal Revenue Service tightened an exception that had allowed companies to move to countries in which they have substantial business activities. It will not prevent moves through a merger, such as Eaton's.

Lawmakers of both parties have said the U.S. corporate tax code needs a rewrite and they are aiming to try next year. One shared source of concern is the top corporate tax rate of 35%—the highest among developed economies. By comparison, Ireland's rate is 12.5%.

The Obama administration has proposed lowering the rate to 28%, while Republican rival Mitt Romney has proposed 25%.

Critics of the tax code also say it puts U.S. companies at a disadvantage because it taxes their profits earned abroad. Most developed countries tax only domestic earnings.

While executives would welcome a lower tax rate and an end to global taxation, some worry their tax bills could rise under other measures that could be included in a tax-overhaul package.

U.S. multinationals often pay far less than 35% because of various breaks, including the option of deferring the payment of U.S. taxes on foreign earnings until they are brought to the U.S. Those companies could pay higher taxes under Obama administration proposals to limit the benefits of deferral. Rowan cited that potential change in announcing its move.

Obama administration officials play down the significance of the recent company moves and say their proposals would encourage companies to stay in the U.S.

In his State of the Union speech in January, President Barack Obama said that "it's time to stop rewarding businesses that ship jobs overseas, and start rewarding companies that create jobs right here in America."

Some companies worry that lowering the general corporate tax rate would require eliminating tax breaks for specific firms or industries. Even without a tax-code overhaul, Congress could eliminate some tax breaks to reduce the deficit.

For companies that leave the U.S., the appeal of lower taxes "is still there, but people now are also getting more concerned about where tax reform is going," says Bret Wells, a University of Houston law professor.

Still, several key lawmakers hope to rewrite the tax code to give companies an extra incentive to stay in the U.S.

Tax reform needs to "put American businesses in the best position to compete in the global economy while adding U.S. jobs." said Sen. Max Baucus (D., Mont.), the Senate Finance Committee chairman, in a recent statement.

And House Ways and Means Chairman Dave Camp (R., Mich.) said in a recent statement that "comprehensive tax reform that lowers rates and transitions the U.S. to a territorial approach that is used by our global competitors is critical to making America a more attractive place to invest and hire."

[Penguin_ie 6,000]

**** Many posts removed for personal attacks, off topic bickering which contributes nothing to the discussion of the OP, and attempting to get around the language filter. Stick to discussing the OP or thread bans will follow. ******

Edited July 29, 2014 by Penguin_ie

[Trumplestiltskin 5,791]

Trying to get around the language filter eh? So that's why my on topic post was removed? ?

[Penguin_ie 6,000]

Trying to get around the language filter eh? So that's why my on topic post was removed? ?

Yes.

You are free to re-post the on topic, civil part of your post.

[Trumplestiltskin 5,791]

It would be quicker to edit out the offending word, wouldn't it?