Wednesday, August 27, 2014

Joe Scarborough thinks...

...we should all boycott Burger King over its plan to buy Tim Hortons, the Canadian coffee and donut chain. And my first response is, Do people still go to Burger King?

My second response is to recommend this recent piece in the New York Times by Andrew Ross Sorkin, "Tax Burden in U.S. Not as Heavy as It Looks, Report Says." Sorkin maintains that companies may not be using inversion to avoid taxes after all. He quotes Edward D. Kleinbard, a professor at the Gould School of Law at the University of Southern California and a former chief of staff to the Congressional Joint Committee on Taxation (my emphasis):

“Despite the claims of corporate apologists, international business ‘competitiveness’ has nothing to do with the reasons for these deals,” he writes. “Whether one measures effective marginal or overall tax rates, sophisticated U.S. multinational firms are burdened by tax rates that are the envy of their international peers.”

Professor Kleinbard argues that lower tax rates are not driving companies to inversions; instead, he contends it is all the money that companies have overseas — some $2 trillion — and don’t want to bring back to the United States despite protestations by many chief executives that they wish they could.

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