2016 Postmortem

FreakinDJ

(17,644 posts) Fri Mar 25, 2016, 09:45 AM Mar 2016

Clinton / DLC / Third Way Administration created the largest Corp Tax Avoidence Scam in History

It always gives me a pretty good chuckle when I see Hillary stumping against "Corporate Inversions" and the latest Multinational Tax Avoidance Scam circumventing the United States Tax laws. If not for her husband's DLC / Third Way policies in the mid 90s the majority of Multinational Corporate Tax Avoidance would not be possible.

This was the first Yuuuge Corporate Tax Loop Hole a Clinton administration designed into the Federal Tax code

The analysis reveals that the biggest names in corporate America are boycotting the U.S. tax system, en masse. Top offenders include giants from high-tech (Microsoft, $76 billion); Big Pharma (Pfizer, $69 billion); Big Oil (ExxonMobil, $47 billion); investment banks (Goldman Sachs, $22 billion); Big Tobacco (Philip Morris, $20 billion); discount retailers (Wal-Mart, $19 billion); fast-food chains (McDonald's, $16 billion) – even heavy machinery (Caterpillar, $17 billion). General Electric has $110 billion stashed offshore, and enjoys an effective tax rate of four percent – 31 points lower than its statutory obligation to the IRS.

The Kennedy-era reforms kept corporate tax avoidance substantially in check through both Democratic and Republican administrations. Even Reagan cracked down on multinational tax dodgers with the tax reform of 1986. But changes in recent years – including one in 1997 and another in 2006 – have, according to a recent Senate investigation, "nearly completely undercut" the ability of the Treasury to tax the paperwork profits of multinationals. The original sin was committed by the Clinton Treasury – then led by Robert Rubin, later a top executive at Citigroup and a major player in the subprime mortgage crisis. In 1997, Treasury changed regulations to permit corporations to decide for themselves which subsidiaries were relevant for tax purposes, simply by ticking off a box on a tax form. But these changes, intended to simplify the tax code, also opened a colossal loophole.

By telling the IRS to treat certain offshore subsidiaries as "disregarded entities" – a.k.a. "tax nothings" – corporate accountants could divert and mask passive income, making it untaxable abroad. "I don't think they realized how much check-the-box would lubricate international tax avoidance," says Kleinbard.

For a brief moment, Treasury sought to reverse course. But lobbyists from firms including Monsanto, Morgan Stanley, IBM and Philip Morris locked arms to defend their de facto tax cut. The Clinton Treasury backed down. Soon, some administration officials took a spin through the revolving door – raising troubling questions about the relationship between corporate America and its regulators. William Morris, who became the Clinton Treasury's associate international tax counsel around the time the regulations were enacted, jumped to GE, where today he orchestrates the firm's global tax policy.

http://www.rollingstone.com/politics/news/the-biggest-tax-scam-ever-20140827?page=2

But that wasn't enough to satisfy the Clinton Administration's corporate donors. The REAL Money was in "Transference of Intellectual Property Rights" This allows Silicon Valley's Mega Multinationals to avoid taxes on $Billions in Licensing and Royalties fees while still receiving Federal Tax breaks for the R&D cost to develop the technology - they get us "Coming and Going"

“It is the largest world trade agreement in history,” Clinton told a congressional delegation at the White House Sept. 20. “It will provide a global tax cut of $740 billion, reducing tariffs worldwide by more than a third.”

https://library.cqpress.com/cqalmanac/document.php?id=cqal94-1102970

Once again with Hillary by his side ....