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Obama’s “Inversion” Crusade Is Really Just Another Attack On Businesses


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obamas-inversion-crusade-another-attack-businessesRedState: Obama’s “Inversion” Crusade Is Really Just Another Attack On Businesses

By: alanjoelny (Diary) | July 26th, 2014 at 09:50 AM


Obama has called “for an end to a corporate loophole that allows companies to avoid federal taxes by shifting their tax domiciles overseas in deals known as “inversions.” Such as statement shows the utter ineptitude that Obama has for understanding a) what inversion actually is and B) how his policies are the cause.


Inversion is not a “corporate loophole” and companies who do so are not “avoiding federal taxes”.


Currently, only the United States taxes American companies on foreign profits as well as domestic. No other major country does this. This policy is non-competitive, stupid, and a major reason why inversion occurs. An American company is being taxed in two jurisdictions.


For instance, if Honda is making cars in the United States, it pays the same taxes as General Motors. But if an American company is in Japan, it has to pay both Japanese taxes and American taxes and therefore has to make an even larger profit just to stay competitive and survive. Scissors-32x32.png

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Inversion Therapy for Liberals
Steven Hayward
July 28, 2014

As we note here frequently—like yesterday, on the minimum wage—when it comes to economics liberals suffer from a severe case of cranial-rectal inversion.

Liberalism’s latest trip to a tight dark place is over the issue of —irony alert— “inversions,” whereby American corporations buy foreign companies and “relocate” their headquarters to a foreign nation to lower their corporate income taxes. Kind of like what rich northeasterners do when they retire and move to Florida (no personal income tax), or as any number of American companies have done by moving to Texas (lower taxes and less nonsense of every other kind).


The reason for inversions is simple: the U.S. has the highest corporate income tax rate in the world, by a full ten points over the next highest. To be sure, by taking advantage of the many wrinkles in the tax code carved out for favored industries or government purposes (like “green” energy—yeah, it’s green, but a different kind of “green” than you thought), many American corporations have a net tax bill that is far lower than the “rack rate” of 35 percent, but that just shows the corruption and special dealing that riddles our tax code, and is a screaming advertisement for genuine tax reform.





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