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Corporate Tax Reform: Taxing Profits in the 21st Century

Book Description

Corporate tax reform is in the air. Competitive pressures from globalization, as well as skyrocketing budget deficits, are forcing lawmakers to rethink how America's largest businesses are taxed. Some want to close "loopholes." Others want to end all U.S. tax on foreign profits. Some want to lower rates, while still others want to abolish the corporate tax altogether and replace it with an entirely new system. Unlike many other books on tax policy, Corporate Tax Reform: Taxing Profits in the 21st Century is not selling an idea or approaching the issue from a particular political slant. It boils down the complexity of corporate taxation into simple language so readers can make up their own minds about the future of this controversial tax. For too long, the issue of corporate tax reform has been the exclusive domain of lawyers and economists who devote their entire adult lives to studying the tax. Corporate Tax Reform: Taxing Profits in the 21st Century opens the door on these issues to all concerned citizens by providing a compact guide to the economics and politics of the current debate on corporate tax reform.

  • Provides an overview of the corporate tax and the possibilities for reform

  • Discusses the impact on businesspeople and individual taxpayers

  • Boils down complex tax concepts boiled into simple language

  • Spurs lively discussion of the political issues without political bias

  • Includes a discussion of ideas for revamping taxes for individuals, since the corporate and individual tax codes are interrelated

What you'll learn

  • Why economists want to abolish the corporate tax

  • Why politicians can't get rid of the corporate tax

  • What the biggest and the slimiest loopholes are

  • The ramifications of all possible outcomes for businesspeople

  • How the U.S. tax code compares to foreign competitors

  • The major options for reform, including the flat tax

  • How politics and tight budgets will shape the debate before and after the 2012 election

  • Why individual taxpayers have a stake in the outcome of this debate

Who this book is for

Corporate Tax Reform: Taxing Profits in the 21st Century is for citizens concerned about America's future who want to get beyond the economic jargon and political rhetoric that dominates most discussion of business tax policy. As the debate on the complex issue of corporate tax reform rages in Washington, Corporate Tax Reform: Taxing Profits in the 21st Century is a beginner's guide that is useful to business executives, market analysts, journalists, lawmakers, government policy analysts, lawyers, accountants, as well as students of public policy, law, accounting, and economics.

Check out Tax Notes' review of Corporate Tax Reform.

Table of Contents

  1. Title
  2. Dedication
  3. Contents
  4. About the Author
  5. About the Technical Reviewer
  6. Introduction: Before We Begin
    1. A Little Bit of History
  7. Chapter 1: Let the Debate Begin
    1. The Old Debate
    2. New Challenges
    3. Proposals for Change
    4. Illusion of Consensus
    5. Summary
  8. Chapter 2: Profits and Profit Tax, by the Numbers
    1. The Profit Roller Coaster
    2. Revenue You Can’t Count On
    3. Two Sets of Books
    4. A Tax on Big Business
    5. The Bottom Line
    6. Falling Effective Tax Rates
    7. Summary
  9. Chapter 3: The Overwhelming Case Against the Corporate Tax
    1. The Double-Tax Burden
    2. Problem 1: Less Capital Formation
    3. Problem 2: The Corporate Sector Suffers
    4. Problem 3: Too Much Debt
    5. Problem 4: Bias Against Dividends
    6. Summary
  10. Chapter 4: Why the Corporate Tax Won’t Go Away
    1. Corporations as Tax Shelters
    2. Integration of the Individual and Corporate Taxes
    3. The (Non-)History of Integration
    4. The Case Against Any Corporate Tax Cut
    5. The Emotional Appeal of the Corporate Tax
    6. Summary
  11. Chapter 5: Cut the Rate!
    1. Chicken Soup for the Code
    2. A Worldwide Trend
    3. Rate Cuts vs. Incentives for New Investment
    4. Critical Accounting Issues
    5. Summary
  12. Chapter 6: Where the Money Is
    1. The Investment Tax Credit
    2. Accelerated Depreciation
    3. Expensing
    4. The Research Credit
    5. Summary
  13. Chapter 7: Corporate Tax Expenditures
    1. Some Not-So-Terrible Tax Breaks
    2. Oil Company Tax Breaks
    3. Incentives for Alternative Energy
    4. Conclusion
    5. Chapter Appendix: The Corporate Tax Expenditure Budget
  14. Chapter 8: How Should Foreign Profits Be Taxed?
    1. Foreign Profits: To Tax or Not to Tax?
    2. Key Features of U.S. Taxation of Foreign Profits
    3. Should Foreign Profits Get a Holiday?
    4. Should the United States Adopt a Territorial System?
    5. Should the United States Raise Taxes on Multinationals?
  15. Chapter 9: Globalization and the Modern Multinational
    1. Jobs and International Tax Rules
    2. The Price Is Not Right: Profit Shifting
    3. The Magnitude of the Profit-Shifting Problem
    4. Summary
  16. Chapter 10: Pass-Through Entities
    1. Subchapter S: Sweet Spot for Smaller Businesses
    2. Traditional Partnerships Give Way to LLPs
    3. Sole Proprietorships: Mom-and-Pops and Consultants
    4. Not Such Small Business After All
    5. Summary
  17. Chapter 11: State Corporate Taxes
    1. Trench Warfare
    2. Possible Reforms of State Taxes
    3. Summary
  18. Chapter 12: Corporate Tax Simplification
    1. Tax Complexity in General
    2. Corporate Tax Complexity
    3. Sources of Complexity
    4. The Prospect for Corporate Tax Simplification
    5. Summary
  19. Chapter 13: Fundamental Tax Reform
    1. Value-Added Taxation
    2. The Flat Tax and the Fair Tax
    3. The Name Game
  20. Chapter 14: More Bold Reforms
    1. Sweeping Integration Proposals
    2. More VATs
    3. Market Capitalization Tax
    4. Summary
  21. Chapter 15: The Budget and Political Reality
    1. The 2011 Deficit Reduction Deal
    2. Sustainability and Balance
    3. Prospects for Corporate Tax Reform
    4. Summary
  22. Appendix A: Notes on Tables and Figures
  23. Appendix B: Further Reading
    1. General Background
    2. Tax Reform in the 1980s
    3. Proposed Incremental Reforms
    4. Fundamental Reforms, Bold Reforms
    5. Corporate Tax Basics and Integration
    6. Tax Rates and Tax Expenditures
    7. International Corporate Tax
    8. State Corporate Tax
    9. Pass-Through Entities
    10. Simplification
    11. Federal Budget
  24. Index