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Treasury Minimum Tax Argument Relies on Narrow Interpretation of Current/Proposed Rules

Tuesday, the U.S. Treasury Department released a blog authored by Treasury officials Itai Grinberg and Rebecca Kysar. Though the blog purports to make a case for President Biden’s proposal to increase the current minimum tax on foreign profits of U.S. companies, its arguments rely on a very narrow interpretation of current law and the president’s […]

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Tax Foundation Response to Ireland Department of Finance Consultation Document: Consultation on OECD International Tax Proposals

Introduction Tax Foundation welcomes the opportunity to respond to the public consultation on the OECD International Tax Proposals. Tax Foundation is a nonprofit think tank based in Washington, D.C., and our mission is to improve lives through tax policies that lead to greater economic growth and opportunity. We use the four principles of simplicity, neutrality, […]

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Tax Foundation Comments on the Wyden, Warner, Brown Discussion Draft

Introduction Tax Foundation welcomes the opportunity to offer comments on the Wyden, Warner, Brown discussion draft on international taxation. Tax Foundation is a nonprofit think tank based in Washington, D.C., and our mission is to improve lives through tax policies that lead to greater economic growth and opportunity. We use the four principles of simplicity, […]

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GILTI of Neglecting Losses

Sometimes the more you learn about a tax policy, the more it confuses you. Many times, the confusion lies between the intent of the policymakers and what really happens. Often, it’s when important issues were overlooked when the policy was being designed. Such is the case for U.S. companies that run losses on their domestic […]

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Expense Allocation: A Hidden Tax on Domestic Activities and Foreign Profits

The U.S. corporate tax code is a complicated behemoth, loaded with numerous arcane provisions—some of these providing special tax breaks, others imposing special tax penalties. Among the latter group, indirect expense allocation rules penalize domestic activities and impose a hidden surtax on foreign profits. While arcane, expense allocation rules are relevant to current debates because […]

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Adoption of Global Minimum Tax Could Raise U.S. Revenue…or Not

The Biden administration has proposed significant changes to the tax rules that govern how much U.S. companies owe on their foreign profits while working to negotiate a global minimum tax. However, the global minimum tax and the Biden administration’s proposals are quite different. A recent Tax Foundation report dug into the details on the revenue […]

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Options for Reforming the Taxation of U.S. Multinationals

Key Findings We analyze four options for changing the taxation of U.S. muiltinationals: the full Biden administration proposal raises the federal corporate income tax liabilities of U.S. multinationals by $1.37 trillion over a decade; a partial version raises $580 billion; making GILTI consistent with Pillar 2 raises $137 billion; and a revenue-neutral option to fix […]

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Intellectual Property Came Back to U.S. after Tax Reform, but Proposals Could Change That

Tax policy can influence business decisions in a variety of ways, some more easily influenced than others. One decision that the Tax Cuts and Jobs Act of 2017 impacted is where companies choose to hold their intellectual property (IP). International trade data shows a significant shift of IP assets into the U.S. in 2017. However, […]

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How Biden’s Business Tax Proposals Would Impact Taxpayers Across States

The Biden administration has proposed several tax increases on businesses, whether structured as C corporations subject to the corporate income tax or passthrough entities such as S corporations, partnerships, or sole proprietorships that are subject to the individual income tax. It is important to remember that those business taxes ultimately fall on people, including business […]

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Piling on the GILTI Verdicts

The Biden administration has proposed to significantly increase the tax burden on foreign income through a policy known as Global Intangible Low-Tax Income (GILTI). While the administration’s rhetoric focuses on doubling the tax rate on GILTI from 10.5 percent to 21 percent, this is less than half the story. The rate on GILTI is going […]