My jobs bill idea - with $0 addition to the $14.5 trillion debt

[banned from Kos]

Allow full repatriation of overseas corporate profit TAX FREE (its 35% now) on the CONDITION that the tax savings are used to employ domestic workers on a NET CHANGE basis.

That simple.

Example - Cisco has $100 million they want to bring back. Taxes will cost $35 million of that. But if their NET CHANGE in FICA payroll is + $35 million they wash (even up) tax wise.


Net effect - they escape taxes but redeploy $35 million in payroll BACK to the US.

And NET CHANGE is easy to track via FICA taxes.

[GreenPartyVoter]

1. I'm a little slow, here. Are you saying that to offset the corporate profit they have to

hire new workers?

[banned from Kos]

2. New US workers - exactly.

They want to bring money back to the USA with a minimum of tax liability.


I say offset any taxes with domestic Payroll hires (up to 35%).

[Warpy]

3. Well, the taxes on that profit

They won't go for it. They are not going to hire a single new worker in the US until and unless there are people in the US with money in their pockets and ready to buy whatever that new worker produces.

[banned from Kos]

4. Cisco sells over half their product outside the USA

So we export more then.


Now, they may not want to do that. But someone has to try something.

[Ruby the Liberal]

5. You do know what happened in 2004, right?

They took their tax windfall and as soon as the program expired, the went back offshore and laid off hundreds of thousands of people.

Cisco was one of the WORST offenders of this.

Google up Matt Taibbi (Political reporter from Rolling Stone) who has documented this 'tax holiday' nonsense in detail. (If you aren't familiar, he isn't a wonk - he breaks down difficult concepts for the lay reader).

[banned from Kos]

7. yeah - it was a complete failure

There were no conditions on the tax holiday then - just a lower rate.

My plan is to maintain the rate and only allow credits via FICA payments/new employees - a huge difference.

[Spike89]

6. Details aside, this is exactly what needs to happen

We've been totally duped by the flat tax lie. If you want to have some control over complex economy like the US economy, you need a complex tax code. One that rewards "good" behavior (reinvesting in US, paying for benefits, charitable giving, etc.) and penalizing "bad" behavior (pulling excess profits/salary...think CEOs, offshoring, conspicuous consumption, i.e., luxury taxes).

When you have a simple, "flat" tax code, it doesn't really matter if the rate is 10% or 90%, there is no real control of the economy. If you're way low, incentives don't really matter, i.e., if I can cut my taxes in half, it isn't a big deal if my entire tax bill is $1000, so I save $500, nice, but not behavior-changing money. However, just taking 90% (high-level socialism) only works if the business can't flee to a lower tax area (China, Mexico, etc.).

You can get away with the 90% tax rate, if you are willing to trade a ton of incentives to bring the effective rate down low enough to discourage off shoring the business. As I've said elsewhere, set the rate at 90%, but when unemployment is high, offer massive tax credits for companies hiring new American jobs. When investment in "green" technology stalls (when oil is relatively cheap), both reward green investment with tax breaks and punish oil burners with surcharges. If homelessness is a problem, offer incentives to builders, landlords, etc.

The point is that there really is much more to the tax code than choosing a set % and then arguing over whether it is too high, too low, or just right.

[banned from Kos]

8. Flat tax is a lie to finish off the middle class! Its regressive as hell.

My idea? The worst that can happen is that corporations say "Fuck it, we don't want American workers" and reject the tax holiday.


(which very well may happen)

[AndyTiedye]

9. Sounds Like a Plan