The analysis of the New York Times on the maxi cut of taxes in favor of large American groups wanted by the Trump administration with the help of the US giants. Facts, Numbers and Comments
As the Treasury Department prepared to implement the 2017 Republican tax audit, corporate lobbyists were rampant and winning big, writes The New York Times: Lobbyists of large global companies managed, in fact, to obtain an almost total reduction in taxes payable in the United States. The tax legislation approved by the Trump administration has allowed large companies to push the accelerator towards an even more extensive tax reduction than required by the bill, adds the New York Times in a long article.TRUMPIAN CUTTING OF TAXES ON COMPANIES ACCORDING TO THE NYT
What is the consequence of all this
According to the New York newspaper, “the federal government could collect hundreds of billions of dollars less in the next decade than previously foreseen. The budget deficit has risen by more than 50% since Trump took office and is expected to reach $ 1 trillion in 2020, partly as a result of the tax law. ” HOW THE TAX REVIEW IS BORN
The revision of the federal tax law started in 2017 as a result of Donald Trump’s presidency. It was the biggest tax change in the US in three decades, and it enabled a tax cut for large corporations, as part of an effort to get them to invest more in the US and discourage them from putting their profits in tax havens. overseas. Of course, the NYT points out, “managers, major investors and the wealthiest Americans hailed the tax cut as a boon, but also for the US economy. Big corporations wanted more – and, not long after – the Trump administration began turning the tax package into a major godsend for the world’s largest corporations and their shareholders. “HERE ARE THE COMPANIES THAT HAVE GUIDED THE BLITZ PRO CUTTING TAXES
“The lobbyists targeted a couple of major new taxes that were supposed to raise hundreds of billions of dollars from companies that had avoided taxes, in part by claiming that their profits were earned outside the United States,” he noted. the NYT talking about the Beat and the Gilti. The first stands for base erosion tax and anti-abuse tax. It was largely aimed at foreign companies with major operations in the United States, some of which for years had minimized their US tax payments by shifting money between American subsidiaries and their foreign parent companies. The other great measure was called Gilti: low-tax global intangible income. To reduce the benefits that companies derived from it, claiming that their profits were made in tax havens, the law imposed an additional tax of up to 10.5% on some offshore earnings. “The blitz was led by the largest companies in the world, including Anheuser-Busch, Credit Suisse, General Electric, United Technologies, Barclays, Coca-Cola, Bank of America, UBS, IBM, Kraft Heinz, Kimberly-Clark, News Corporation, Chubb, ConocoPhillips, HSBC and the American International Group, ”explained Nyt.WHY THE CUT OF CORPORATE TAXES IS CLAMOROUS
“Thanks also to the rough way in which the bill was written and approved by Congress – a situation that gave the Treasury Department more leeway to interpret a law – the corporate lobbying campaign was a resounding success “, underlined the American newspaper according to which the Treasury has” cut out exceptions to the law “guaranteeing many of the main American and foreign companies that they have to pay” little or nothing in new taxes on offshore profits “.
Hence the numerous criticisms such as that of Bret Wells, professor of tax law at the University of Houston, collected by the NYT: “The Treasury is gutting the new law. The richest people in the world will benefit disproportionately ”. A tax break that was supposed to help poor communities – an initiative called “opportunity zones” – is also being used in part to fund high-level developments in affluent neighborhoods, sometimes for the benefit of those with ties to the Trump administration.
Of course, the companies didn’t get everything they wanted, and Brian Morgenstern, a spokesman for the Treasury, defended the department’s handling of tax rules. “No particular taxpayer or group had undue influence at any point in the process.”GOOGLE, APPLE, CISCO, PFIZER, MERCK, COCA-COLA, FACEBOOK HAVE DEVELOPED ALTERNATIVE METHODS TO PAY LESS TAXES
“Since the birth of the modern federal income tax in 1913, companies have invented ways to avoid it. In the late 1990s, American corporations accelerated their efforts to ensure that trillions of dollars in profits earned in high-tax places – such as the United States, Japan, or Germany – were actually earned in low-tax places like Luxembourg. Bermuda or Ireland. Google, Apple, Cisco, Pfizer, Merck, Coca-Cola, Facebook, and many others have developed elaborate techniques that allow companies to pay taxes at rates much lower than 35% of the U.S. corporation tax that existed before the 2017 changes. Their cute nicknames – like Double Irish and Dutch Sandwich – made them sound benign.FOR THE US THE LESS COLLECTION OF TAXES AMONG ALL OECD COUNTRIES
“Two years after the tax cuts became law, their impact is becoming clear,” the NYT explained. Companies continue to move hundreds of billions of dollars to overseas tax havens, ensuring that huge corporate profits remain out of the reach of the US government. The Internal Revenue Service is raising tens of billions of dollars less in corporate taxes than Congressional projections. This month, the Organization for Economic Co-operation and Development calculated that the United States in 2018 experienced the largest decline in tax revenues of all 36 member countries of the group. The United States also has by far the largest budget deficit of all these countries. Furthermore, in the next few days
