Yesterday, US Treasury Department Secretary Jacob Lew said that it will decide “in the very near future” if it has the authority to strip tax incentives to American corporations relocating to foreign countries.
By Jeff Berwick @ The Dollar Vigilante
Lew is a proponent of such action, believing that US corporations leaving the US for better foreign tax rates, while maintaining headquarters in the US, should be violently opposed. The Obama regime has said it believes such legislative action should be retroactive, and authoritarians in the ranks are rising to the occasion to champion the tyrannical actions.
“The Treasury Department is completing an evaluation of what we can do to make these deals less economically appealing, and we plan to make a decision in the very near future,” according to Lew. “Any action we take will have a strong legal and policy basis, but will not be a substitute for meaningful legislation — it can only address part of the economics.”
Lew placed his own brand of morality onto what are companies that are fleeing the US for lesser-extorted waters.
“This may be legal,” he noted, “but it is wrong, and our laws should change.”
He stated, with our translation in brackets, “By effectively renouncing their citizenship but remaining here, these companies are eroding America’s corporate tax base,” Lew explained. “That means all other taxpayers (extortees) — including small businesses and hardworking Americans (tax slaves) — will have to shoulder more of the responsibility of maintaining core public functions that everyone, particularly US businesses, depends on. We are talking about our national defense (the military industrial complex, Department of Offense), education (citizen indoctrination camps), medical research, courts (private prison and legal complex) and vital infrastructure such as roads, bridges and airports. And if we allow the incentives to pursue these deals to remain in place, we run the risk of undoing the progress we have made to reduce our federal budget deficit (massive multi-billion dollar, unheard of deficits).”
He called for immediate action.
“Only a change in the law can shut the door, and only tax reform can solve the problems in our tax code that lead to inversions,” Lew said.
Lew knows any change to the tax code this year is unlikely, but stressed that inversions are “one loophole that should be shut down immediately.”
“Right now, our tax system rewards US corporations when they buy foreign companies and then declare that they are based overseas,” he said. “By effectively renouncing their citizenship, but remaining here, these companies are eroding America’s corporate tax base.”
He doesn’t mention the fact that no US-based corporation actually thwarts the extortion regime (IRS) in the US. All of those companies, including Burger King, actually pay these exortion payments for every penny of profit they make inside the US. What they are trying not to do is to pay the highest corporate tax in the world, in the US, on worldwide profit.
Debate remains over whether the Treasury Department has the power to take away such tax incentives, and especially whether they can make their decisions retroactive.
Stephen Shay, Harvard University law professor, believes the government has the power already to change the way corporations manage their capital. “When the patient is bleeding, you put on a tourniquet,” he said, calling for the US Treasury to take action.
John Samuels, General Electric Co.’s top tax lawyer, disagrees. Such changes can only be made by Congress, he counters.
While Lew had no new ideas, Congress is pushing to close the so-called door on corporate inversions. Out in front with such legislation is Senator Chuck Schumer, who has been circulating a draft bill in Congress to undermine the “earnings stripping” of inversions. His bill is said to be retroactive to deals as far back as 1994. Yes, 1994…. 20 years ago! Imagine yourself retroactively changing a contract you agreed to 20 years ago and watch how people laugh at your insistence. The only difference here is that the US government is the largest terrorist organization in the history of the planet and they will kill or kidnap whoever they need to to enforce their whims.
According to James Lucier, a managing director at research group Capital Alpha Partners LLC, Schumer’s bill “is profoundly unserious and has zero chance of passing. Instead, it is a piece of political theater.”
In recent history, inversions are increasing, with Medtronic Inc and Burger King most recently making headlines. Since 1983 fifty-two big deals have occurred, of which approximately half have been since the 2008-2009 Federal Reserve-caused credit crisis, according to Reuters.
Obama has implored Congress for the past four years to act to curb inversions. Obama has also proposed a so-called “substantial business activities” test denying foreign company status when business operations are still mostly located in the United States and managed by US players.
No matter what the case, it is clear, the USSA government has no law, no morals and no adherence even to the basic idea of a contract… even though no one, ever, has signed an actual contract in which they agreed to pay taxes.
Businesses and people are fleeing at an epic pace from the US, now nearing Soviet Union style defections. And, the American public is becoming a laughing stock of the world as they continue to believe they are the freest country on Earth when, in fact, they are about as close to the Soviet Union or modern day North Korea as any other country on Earth.
What isn’t noticed by many is that while there have been fifty-two major tax inversions in the US there have been countless private businesses that were either never started in the US or who just moved offshore due to the oppressive anti-business taxation in the US (to find out how to move your business offshore, or start a new one outside of the USSA, contact TDV Offshore).
The fight to stop tax inversions is solely a symptom of The End Of The Monetary System As We Know It (TEOTMSAWKI) and every action taken by the US government now to “stop the bleeding” will only make the patient bleed more.
Those who recognize this dramatic economic and financial shift before others have the opportunity to not only survive but profit from what is about to become the collapse of the American empire. Those who remain asleep have what is coming to them.
This article originally appeared at The Dollar Vigilante