A Corporate Tax Proposal from Larry Summers

From Larry Summers:

The US should eliminate the distinction between repatriated and unrepatriated foreign corporate profits for US companies and tax all foreign income (after allowance for taxes paid to other governments) at a fixed rate well below the current US corporate rate of 35 per cent, perhaps about 15 per cent. A similar tax should be imposed retrospectively on accumulated profits held abroad.

Such a proposal could easily be designed to raise revenue relative to the current baseline, encourage the repatriation of funds to the US, and reduce the competitive disadvantage faced by American multinationals. It is a fair compromise between businesses and reformers. It is as close to a free lunch as tax reformers will ever get.

 

Advertisements

About ozidar

I'm an Assistant Professor of Economics at the University of Chicago Booth School of Business and a Faculty Research Fellow at National Bureau of Economic Research. You can follow me on twitter @omzidar. http://faculty.chicagobooth.edu/owen.zidar/index.html
This entry was posted in Uncategorized and tagged , , , , , , , , , . Bookmark the permalink.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s