“Standard & Poor’s believes they would, and it argued in a new report Wednesday for a program that would allow companies repatriate the more than $2 trillion parked overseas on a tax-free basis, in return for committing 15% of it to investments in interest-bearing infrastructure bonds that would be issued by state and local governments,” Linnane reports. “‘There is bipartisan support, including from the presidential candidates, to address our country’s infrastructure problems, but there is little consensus on how to fill the huge gap between what the government can finance and how much money is needed to pay for these projects,’ Beth Ann Bovion, U.S. chief economist at S&P Global Ratings. ‘Private capital can be part of the solution.'”
“Companies such as Apple Inc. have been holding enormous sums overseas for years, and Apple’s chief executive, Tim Cook, has been vocal about his refusal to repatriate those funds as long as the U.S. corporate tax rate remains at 35%,” Linnane reports. “The opportunity to reap a return on investment rather than lose funds to taxation would be a ‘substantial enticement’ for companies, according to S&P. And the proceeds of bond sales would spur economic growth and create jobs through the ‘multiplier affect,’ said Bovino.”
Linnane reports, “For S&P, the move would merely be the first step in a broader overhaul of the corporate-tax regime that would discourage the kind of cash hoarding that is starving the Treasury of tax monies.”
Read more in the full article here.
MacDailyNews Take: “Starving the Treasury of tax monies?”
The federal government collected a record $3,248,723,000,000 in tax revenue for the 2015 fiscal year, amounting to a whopping $21,833 per worker, according to the Final Monthly Treasury Statement. Of course, the U.S. federal government spent $3,687,622,000,000, running a deficit of $438,899,000,000 for the 2015 fiscal year.
We don’t have a trillion-dollar debt because we haven’t taxed enough; we have a trillion-dollar debt because we spend too much. – Ronald Reagan