Jeffrey M. Kadet, U.S. Tax Reform: Full-Inclusion Over Territorial System Compelling Tax Notes 295 (2013), https://digitalcommons.law.uw.edu/faculty-articles/1052
International Taxation, International Tax Reform, Full-inclusion, Territorial
The territorial system strongly lobbied for by U.S. multinational corporations that stand to benefit from that system is not what’s best for our country or our society. It is bad tax policy for many reasons, including the strong motivation it provides our multinational corporations to continue moving operations, jobs, risks, and assets outside the United States to achieve double non-taxation. A worldwide full-inclusion system would severely curtail or completely eliminate that strong motivation because double nontaxation would no longer be possible because of a current federal tax on all earnings that cannot be eliminated through any tax schemes or creative avoidance. A worldwide system also would increase the tax base and help make possible the lower overall corporate tax rate that both political parties desire.