A repatriation tax holiday? It’s expensive. The Joint Committee on Taxation estimates that such a holiday would cost $95.8 billion in revenue over the next decade, though it would bring in about $19.6 billion over the first two years. Some lawmakers raised the idea of temporarily reducing US corporate income taxes on repatriated offshore profits to replenish the Highway Trust Fund. Bloomberg reports that as of earlier this year, 307 large US-based companies held a total of $1.95 trillion in profits outside the US, though some firms may not be waiting to bring funds back to finance US acquisitions.
When it comes to tax havens, the Union Jack is the new black. Reuters reports that while the Caribbean Islands or Switzerland used to be a favored home to reincorporated US companies seeking lower tax bills, legal changes in Britain have made the UK more attractive. The UK for the most part does not attempt to tax corporate profits earned in other countries. Seven US corporations have changed their corporate addresses to Britain and 12 others have tried over the past year.
India’s new Prime Minister wants to find and tax “black money.” Fresh off his victory in the world’s largest democratic vote, Narendra Modi has set up a team to find an estimated $2 trillion in hidden assets, or “black money.” That could translate into tax revenue of over $600 billion, according to an analysis by economics professor Arun Kumar of New Delhi’s Jawaharlal Nehru University.
Angola is updating a decades-old tax system. The southwestern African nation, recovering from a 27-year civil war that ended in 2002, wants to broaden and streamline tax collection and increase revenue. The Christian Michelson Institute’s new report suggests that fewer tax brackets and higher income tax rates on the nation’s wealthiest could increase Angola’s revenue and simplify collection. Angola raised $1.4 billion last year in personal income taxes.
On the Hill today: House action on three extenders and ACA credits is scheduled for today. This afternoon the House is scheduled to begin its consideration of the Permanent S Corporation Built-in Gains Recognition Period Act of 2014 and America's Small Business Tax Relief Act of 2014. Also today, the House Ways and Means Subcommittee on Oversight will review the government’s ability to verify income and insurance information necessary for tax credits and subsidies under the Affordable Care Act.
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