The Tax Cuts Do Not Contain a 50% Off Coupon for Companies Who Move Overseas

Brown says this consistently on the campaign trail and it’s just not true. In fact, we expect higher tax revenue because of this new provision.

From Brown’s Op-Ed: “Under their law, companies earning profits in Hamilton County pay a 21 percent tax rate. But if those companies send jobs to Wuhan, China or Reynosa, Mexico, they owe just a 10.5 percent rate on some of those overseas profits. It’s like handing out 50 percent off coupons to corporations that send jobs overseas.”

·  Before the Tax Cuts & Jobs Act, companies that moved jobs overseas were paying 0% U.S. tax after planning. It was a loophole that large, multinational corporations used to avoid paying the high US corporate tax rate.

·  Now, thanks to a new provision known as GILTI, they’re paying 10.5%That’s revenue that was not getting taxed under the old law. (Cite found in Table 1, second row)

· In other words, it was a provision that closed a tax loophole and ended up being a tax INCREASE on these companies – not a cut. As a matter of fact, the Joint Committee on Taxation estimates this tax will bring in $112.4 billion in NEW revenue between 2017 and 2027. That’s new revenue that wasn’t coming in under the old law. (Cite found on page 7)

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