Clinton’s Shrewd Plan to Stop Inversions

Political campaigns are not generally known as ideal laboratories for devising sensible, innovative policies. Yet Hillary Clinton’s proposals to combat corporate inversions — in which U.S. companies move their tax homes abroad — are just that. They would largely eliminate the tax incentives to invert.

A U.S. company currently has many such incentives. It can lower its taxes by creating a home base in a low-tax country, even if it leaves its headquarters and other operations in the U.S., and even if the U.S. operations represent as much as 79.9 percent of the new combined company (though the rules are stricter if the share is 60 percent to 80 percent).

from Bloomberg View – Articles by Peter R. Orszag

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