G20 finance ministers back plan to stop use of tax havens

FarmboyJuly 11  09:13 pm JST

Republicans seem to like Bermuda for their tax havens, so I can see why they are expressing opposition.

Why travel all the way to Bermuda? Dam stalwart John Kerry was caught docking his 76-foot yacht in Rhode Island instead of his home state of Massachussettes, thus avoiding the $500,000 or so in excise taxes he’d have to pay by doing so.

fxgai, the balance sheets, the covid factor, US domestic increased taxation threshold to medium sized business could suffer the effects.

Eight years and no a prospect of agreement.

This is an unworkable theory. To pretend that some consensus-based multilateral solution to enforce an agreement by some fairyland Inclusive framework is cloud cuckoo land. 

This whole strategy is politically ideologically based.

The Government of China will just play along. Their corporates structure is so opaque it is impossible to fully ascertain who owns what.

Biden has proposed roughly doubling the rate to 21%, which would more than comply with the proposed global minimum.

I think the tax cartel idea is stupid - just wait until people who understand that business is what creates jobs and prosperity take control of their countries - but what is the logic of “more than complying” with the proposed global minimum?

If you have mobile capital, which we do in 2021, does it make sense to stay in the US if the minimum is effective when operating elsewhere? On the balance, it will, at the margin, prompt some businesses to head elsewhere.

Policy makers need to understand that taxes effect economic behavior. One has to think that they aren’t stupid and they do know these realities, but they don’t care and are going to enact bad policies anyway.

Good on the G20.

Republicans in the Congress have expressed opposition to the measure. Rep. Kevin Brady of Texas, the top Republican on the tax-writing Ways and Means Committee, has blasted the OECD deal, saying, “This is an economic surrender to China, Europe and the world that Congress will reject.”

Republicans using their trigger word generator for their base that have really nothing to do with the pros or cons of the proposal.

Raising the rate is part of a broader proposal to fund Biden's jobs and infrastructure plan by raising the domestic corporate tax rate to 28% from 21%.

The rate was 52% during the Kennedy administration. Think about the socio-economic changes since then.