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Old 01-10-2018, 11:56 AM
 
Location: Paranoid State
12,671 posts, read 9,420,097 times
Reputation: 14919

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It is a tax increase from zero to 10.5% on overseas profits that previously stayed overseas.

Those profits are still subject to taxation in the overseas jurisdictions: the corporation pays tax overseas.

It reduces from 100% to 80% the credit that a US corporation gets from having paid that overseas income tax when they move the money back to the USA.

Corporate executives across the board have said the new tax system provides adequate incentives to repatriate money.

Still, what Congress SHOULD have done is reduce the US Corporate Tax Rate to zero.
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Old 01-10-2018, 12:03 PM
 
Location: Myrtle Creek, Oregon
11,040 posts, read 11,450,778 times
Reputation: 17199
Quote:
Originally Posted by Jobster View Post
That's already going to happen. How do you expect American workers to compete with much lower paid foreign workers in developing countries?

Additionally, human labor capital will continuously be replaced with technology.

What could Hillary do to stop this?

I'm not a fan of any politician, but I'm getting tired of the media acting so smug when it comes to Trump. Explain to me what the last administration did in the previous 8 years.

What did they do to make things better?

They didn't do anything. There isn't any foresight. All the previous administration did was lower interest rates to the point of creating an unsustainable and artificial economy, while simultaneously walking up the stock market with liquidity injections from various sovereign entities through their national banks.

Why wasn't infrastructure developed at the beginning of Obama's presidency? It was the opportune time to have a national agenda and come together as a nation to build a sustainable economic system, but instead, we continued with the status quo.

Now, we are in a situation where oil prices will sky rocket within the next 3-5 years and the US is in a proxy war with Russia, ultimately because of natural resources, when Russia has approximately 60 years of oil and the US has about 5 years.

People are so complacent.

I can't stand the press. Trump this Trump that. Yes, the Trump administration is terrible, but how is it any different than his predecessors? What long term, multi-generational problem did the last administration solve?

I don't think people will realize the situation we're in until it finally happens. Personally, I think oil prices will be the catalyst because oil is part of the REAL economy, not the fake artificial stock market that makes people believe they are wealthy.

However, I don't know. There are many risks. Consumer credit is at the highest level it's ever been at. The crypto market is completely irrational. I don't understand how people think things are great when they consider the next generation.

Sure, there are many wonderful things associated with modern technology that makes are lives much more livable than even 50 years ago, but we have not created solutions for things that we are dependent on, that we are running out of rapidly.
You need to realize that Trump had very little to do with the Republican Tax Bill. It was all congress and lobbyists who pulled that little scam. All Trump did was roll over like a good puppy.
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Old 01-10-2018, 01:05 PM
 
1,025 posts, read 558,839 times
Reputation: 300
Quote:
Originally Posted by Thatsright19 View Post
A unique concept? Are you serious, Clark?

https://en.m.wikipedia.org/wiki/Triffin_dilemma
https://en.m.wikipedia.org/wiki/Global_saving_glut


After your embarrassing start to this thread discussing the international tax rate\system, I guess you want to double down on being wrong about the international reserve system too?
ThatsRight, I sit corrected before my keyboard. The concept seemed so implausible that I didn't wait for a chance to discuss it with my son.

I'm very much aware of trade deficit's detriment to their nation's GDPs, but my son rather than I is more knowledgeable regarding U.S. Federal Reserve Board's attempts to regulate the U.S. Dollar's value.
I think regulating it is an impossible task and I'm grateful and amazed they have not yet destroyed ours and much of the remaining world's economy.

USA's annual trade deficits detrimental effects upon our GDP and numbers of jobs is a real effect. The Import Certificate policy is much more market rather than government driven. Thus markets will not simply continue, but better continue to drive our global trade.
IC policy passes all net expenses onto the USA purchasers of imported goods. Any net expenses exceeding federal direct administration and assessing tasks costs, are market determined and serve as indirect price subsidy for USA's exported goods.

Respectfully, Supposn
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Old 01-10-2018, 01:10 PM
 
6,996 posts, read 6,629,325 times
Reputation: 5274
If any company was holding off on setting up an offshore domicile in a tax haven, they no longer have any reason to, unless this law has to be renewed at a later date. That was the only catch before. Many of the big techs firms were paying corporate tax in the low single digits. Several big drug firms attempted mergers with foreign partners to take advantage of the tax exclusion.
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Old 01-10-2018, 02:49 PM
 
6,166 posts, read 3,249,243 times
Reputation: 12502
Quote:
Originally Posted by Supposn View Post
I'm among the proponents of a trade policy described within Wikipedia's “Import Certificates” article. The Import Certificate trade policy would have no problem with USA's new tax laws.
Respectfully, Supposn

/////////////////////////
Excerpted from:
https://www.nytimes.com/2018/01/08/b...e=sectionfront

Tax law may send factories and jobs abroad

Under the new law, income made by American companies’ overseas subsidiaries will face United States taxes that are half the rate applied to their domestic income, 10.5 percent compared with the new top corporate rate of 21 percent.
No way. Really? OMG. I would like to know who put that provision in the law. This gets me ticked off.
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Old 01-10-2018, 02:55 PM
 
6,166 posts, read 3,249,243 times
Reputation: 12502
Quote:
Originally Posted by Jobster View Post
That's already going to happen. How do you expect American workers to compete with much lower paid foreign workers in developing countries?

Additionally, human labor capital will continuously be replaced with technology.

What could Hillary do to stop this?

I'm not a fan of any politician, but I'm getting tired of the media acting so smug when it comes to Trump. Explain to me what the last administration did in the previous 8 years.

What did they do to make things better?

They didn't do anything. There isn't any foresight. All the previous administration did was lower interest rates to the point of creating an unsustainable and artificial economy, while simultaneously walking up the stock market with liquidity injections from various sovereign entities through their national banks.

Why wasn't infrastructure developed at the beginning of Obama's presidency? It was the opportune time to have a national agenda and come together as a nation to build a sustainable economic system, but instead, we continued with the status quo.

Now, we are in a situation where oil prices will sky rocket within the next 3-5 years and the US is in a proxy war with Russia, ultimately because of natural resources, when Russia has approximately 60 years of oil and the US has about 5 years.

People are so complacent.

I can't stand the press. Trump this Trump that. Yes, the Trump administration is terrible, but how is it any different than his predecessors? What long term, multi-generational problem did the last administration solve?

I don't think people will realize the situation we're in until it finally happens. Personally, I think oil prices will be the catalyst because oil is part of the REAL economy, not the fake artificial stock market that makes people believe they are wealthy.

However, I don't know. There are many risks. Consumer credit is at the highest level it's ever been at. The crypto market is completely irrational. I don't understand how people think things are great when they consider the next generation.

Sure, there are many wonderful things associated with modern technology that makes are lives much more livable than even 50 years ago, but we have not created solutions for things that we are dependent on, that we are running out of rapidly.
You're trying to spin the bottle somewhere else. It doesn't MATTER one bit what prior administrations did or did not do. The matter is that the "greatest tax reform ever" has this provision in it.

That's the purpose of the thread.

But since you asked, what the prior administration did was add almost 6 Million jobs to the economy that had been crashed under the prior administration. That's a great accomplishment. Some infrastructure was done (to the extent the Republican Congress allowed it). A health care reform bill was passed (it didn't out great, IMO...but at least someone tried to do something...the Republicans were fine with the system that wasn't working for millions, and the system was clearly failing). And on and on. Many accomplishments. And he CERTAINLY didn't sign a bill that gave corporations even more of a tax break for sending jobs out of the country.

But that's irrelevant to the issue at hand.

(Confused by your reference to Hillary. As far as I know, she was never President. So she has no record on that, and we have no way of knowing what bills the Republican Congress would have passed under her administration.)
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Old 01-10-2018, 02:58 PM
 
6,166 posts, read 3,249,243 times
Reputation: 12502
Quote:
Originally Posted by Larry Caldwell View Post
You need to realize that Trump had very little to do with the Republican Tax Bill. It was all congress and lobbyists who pulled that little scam. All Trump did was roll over like a good puppy.
He signed it. He's ignorant and doesn't know much about taxes or government or laws or much of anything, it seems.

As McConnell said, "He'll sign anything we put in front of him." And he does. Good boy. Now go back to golfing and watching tv and playing on twitter.
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Old 01-10-2018, 03:01 PM
 
1,408 posts, read 807,001 times
Reputation: 3249
Quote:
Originally Posted by bpollen View Post
No way. Really? OMG. I would like to know who put that provision in the law. This gets me ticked off.
Please disregard the OP. About four posts below the OP, it was pointed out that the OP misunderstood the provision.
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Old 01-10-2018, 07:00 PM
 
Location: Myrtle Creek, Oregon
11,040 posts, read 11,450,778 times
Reputation: 17199
Quote:
Originally Posted by NYCresident2014 View Post
Please disregard the OP. About four posts below the OP, it was pointed out that the OP misunderstood the provision.
No, he didn't. That provision is a loophole so big you could sail the Titanic through it. It caps US involvement in foreign taxes at 10.5% combined tax rate, and that means they only pay 10.5% US tax if they pay NO offshore taxes at all. As anyone who has ever done business offshore will tell you, that means they will never pay any US taxes on offshore operations. The VAT alone in Europe ranges from 15% to 28%. The Chinese VAT rate is 17%. In your wildest dreams did you think these companies were not paying offshore taxes?
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Old 01-10-2018, 07:19 PM
 
2,240 posts, read 1,385,700 times
Reputation: 4894
Quote:
Originally Posted by Larry Caldwell View Post
No, he didn't. That provision is a loophole so big you could sail the Titanic through it. It caps US involvement in foreign taxes at 10.5% combined tax rate, and that means they only pay 10.5% US tax if they pay NO offshore taxes at all. As anyone who has ever done business offshore will tell you, that means they will never pay any US taxes on offshore operations. The VAT alone in Europe ranges from 15% to 28%. The Chinese VAT rate is 17%. In your wildest dreams did you think these companies were not paying offshore taxes?
Yes, I actually did. It’s clear you don’t understand how the former worldwide tax regime worked.

This new rule is specifically punishing companies for creating a structure where they move to super low tax areas purely for tax reasons. Under the old system, let’s say you were in Luxembourg or the United Kingdom with super low rates. The u.s got no tax revenue because the money was asserted to be permanently reinvested overseas. Only if the money was brought back to the U.s would they get to tax it. Aka, no one brought it back. Now, this assertion is gone after the one time toll charge on foreign e&p pools and cash reserves.

And if you think about it, would should they owe u.s tax if they’re paying the European or Chinese taxes? Does France collect tax if FOrd sells a car in America? Does Germany? Nope. Why should the u.s get taxes on foreign sales in addition to the foreign country taxing them? This is why the flawed worldwide tax system finally gave way to a territorial system. The toll charge facilitates this monumental transition.

It’s a special provision to punish those who are going somewhere purely for low tax reasons and saying we’re going to reach into that pot and take 10.5 percent. It’s not incentivizing foreign production over international....it’s punishing international activity in tax havens.


I’ll repeat it again. It’s not a cut from 21 percent to 10.5. It’s an increase from zero to 10.5. The base was broadened.

This was repeated again and again in the new law. See: the The “gilti” tax provision and the “beat” tax provision. Congress....so clever with their names.

And really every time congress needed to address budget shortfalls by giving individualss more tax cuts...they kept ratcheting up the toll charge on the e&p and cash reserves to fill in the gaps. So yeah, the rate on future earnings came down...but the base broadened (like with what we’re talking about here) and the toll charge kept going up and up.

Last edited by Thatsright19; 01-10-2018 at 07:37 PM..
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