Need A New Tax Break With That Burger and Fries, Mr. Corp

Don't Eat While Reading This  

(you might choke)

This post comes from a pretty easy to understand story based on this simple and direct question: Are we seeing the end of America as we know it?

A fact: The GOP always argues for lower Corporate taxes as a way to allow them to create jobs (as they are the “givers) and be not be greedy “takers” (the ones Romney introduced us to in 2012).

Another fact: Cutting the corporate tax rate would do little to discourage companies from moving overseas to dodge American taxes, according to a new Reuters analysis of the half-dozen largest companies to launch so-called inversion mergers last year.  

The list of six companies includes both Medtronic and Burger King, household names whose inversion plans drew significant press attention to the growth of the business practice in recent years. 

What is inversion anyway? Inversion allows an American company to merge with a foreign entity then set the corporate headquarters of the merged firm in that other company’s home country, shifting the U.S. firm’s tax residence overseas without requiring any actual realignment of where and how the company does business.

The maneuver is entirely legal and “mainly driven by efforts to shift profits out of the U.S. and to access overseas earnings at little or not cost in U.S. tax,” Reuters explains.

While proponents of a corporate tax cut or repatriation tax holiday often argue that companies undertake these elaborate schemes specifically because of the 35 percent statutory income tax rate that corporations face in the U.S. But that argument ignores the often huge gap between that on-paper tax rate and the effective rate that companies actually pay.

Reuters reports that Medtronic, Burger King, and four other large companies plotting inversions actually paid an average federal tax rate of 20.3 percent from 2011 to 2013. That finding corresponds with other research on effective corporate tax rates, such as a 2014 report from Citizens for Tax Justice that found an effective tax rate of just below 20 percent for the 288 largest profitable companies in America.

Continue that story at the main link and then read this related story from here (it all ties together):

Now ask yourself, and be honest, okay, this question: Whom does the GOP stand and fight for, and on what kind of principles? Oops…