U.S. Cross-border Tax Reform and the Cautionary Tale of GILTI
Daniel Bunn
Key Findings
The U.S. joined many other developed nations in adopting territorial provisions and anti-base erosion rules as part of the 2017 tax reform.
One major piece of that reform, that is not typical in other territorial systems, is a new definition of currently taxable foreign earnings, Global Intangible Low Tax Income (GILTI), which is taxed at an effective rate of 13.125 percent, with the rate set to increase after 2025 to 16.4 percent.
Recent research has shown that foreign earnings of U.S. companies remain taxed at similar rates even after the 2017 reforms, implying that while the structure of U.S. taxes on foreign earnings changed, the overall burden did not.
Washington Democrats bet big on wealth tax aimed at state s billionaires by Tim Gruver, The Center Square | February 03, 2021 08:30 AM Print this article
Under
House Bill 1406, top earners would see a 1% tax applied to paper assets such as cash, bonds, pensions, and stocks in excess of $1 billion. Treasury and municipal bonds would be exempt.
Such a tax would be the first of its kind in the country and would have violators would pay a 5% penalty for every month a return is overdue.
The bill would take effect New Year s Day of 2022 and generated revenue would go straight into the state s general fund. Its sponsor, House Finance Chair Rep. Noel Frame, D-Seattle, said that money would be put towards tax credits for working families and businesses.