Zach Mottl is Chief Alignment Officer at Atlas Tool & Die Works. Zach faced hardship in the 2000s when PNTR was granted to China. He had to do what many US companies had to do: cut jobs. Zach's company has come a long way now, but realizes how important smart trade and smart taxes are for the US economy. Hear his story!
- American Corporation sells $10 billion of its products to customers around the world.
- $6 billion of those sales (60% of total sales) are made to U.S. customers.
- American’s worldwide profit is $1 billion, therefore, $600 million of that profit would be taxed as U.S. profits.
- Where the company claims it earns its income would be irrelevant. U.S. taxable income would be determined solely by the percent of that company’s worldwide sales made to U.S. customers. Foreign MNEs would be taxed the same way on U.S. income, leveling the playing field between domestic firms and foreign and domestic MNEs.
Alta T published I thought Congress just fixed Corporate Tax Reform? in Tax Strategy FAQ 2018-09-13 19:37:13 -0400A:
Congress did pass a comprehensive tax bill in December 2017. To their credit, Congress recognized the tax discrimination that our American domestic corporations are facing. Domestic corporations pay the full corporate tax burden while multinational and foreign companies can shift profits to tax havens to pay less. The Tax Cut and Jobs Act modestly reduced the problem but did not eliminate it. Companies still have significant incentives to move production or profits offshore. It also added complexity instead of simplifying the system.
Our corporate tax system should be reformed to benefit U.S. domestic companies. Instead, it continues to place our businesses at a competitive disadvantage in global markets. Large Multinational Enterprises (MNEs) continue to develop complex, powerful strategies for avoiding domestic taxes, domestic corporations struggle to compete.