Thursday, August 28, 2014

BURGER KING AND THE WHOPPER ON TAXES: Let me explain...

Instapundit » Blog Archive » BURGER KING AND THE WHOPPER ON TAXES: Let me explain. Or actually, in the case of Burger King’s p…:

BURGER KING AND THE WHOPPER ON TAXES:
Let me explain. Or actually, in the case of Burger King’s planned acquisition of Tim Hortons, let my colleague Matt Levine explain, because he is smarter and funnier and a better writer than I am, and has already nicely summed things up:
The purpose of an inversion has never been, and never could be, and never will be, “ooh, Canada has a 15 percent tax rate, and the U.S. has a 35 percent tax rate, so we can save 20 points of taxes on all our income by moving.”


Instead the main purpose is always:If we’re incorporated in the U.S., we’ll pay 35 percent taxes on our income in the U.S. and Canada and Mexico and Ireland and Bermuda and the Cayman Islands, but if we’re incorporated in Canada, we’ll pay 35 percent on our income in the U.S. but 15 percent in Canada and 30 percent in Mexico and 12.5 percent in Ireland and zero percent in Bermuda and zero percent in the Cayman Islands.”



"The United States has been able to get away with this kind of intrusiveness because we’re powerful. As Obama makes us less powerful, there’s increased incentive for other countries to band together against this practice. Though on the other hand, they may favor it as a way to get businesses to relocate outside the United States.
Here’s a crazy idea: Let’s have a business climate that would make people want to headquarter their businesses here.
UPDATE: From the comments: “The global community has spoken: don’t tax income earned overseas. That cowboy Obama is going it alone.”"

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