Quantcast
Get breaking news alerts via email

Click here to manage your alerts
Sen. Hatch: Tax reform done right

First Published Aug 08 2014 09:06 am • Last Updated Aug 08 2014 05:40 pm

In Washington, short-sighted policies proposed for political messaging purposes often eclipse substantive dialogue. That is exactly what we are seeing as congressional Democrats and the Obama administration play election-year politics with the growing challenge of corporate inversions.

Over the past few months, many companies have responded to our overly burdensome corporate tax system by re-domiciling their headquarters overseas. Such moves leave the United States with a smaller tax base that results in many billions of dollars in lost revenue. Clearly, this is a cause for concern, and, unfortunately, it is unlikely to go away anytime soon.

Join the Discussion
Post a Comment

Despite this grim reality, however, every Democratic proposal offered so far to deter such action has been purely political. What’s more, these proposals contain punitive and retroactive provisions that would exacerbate the problem.

Instead of working with Republicans on a productive way forward, Democrats have sought to politicize the issue — conveniently timed given the upcoming election — by engaging in name-calling and labeling such businesses "corporate deserters."

This problem demands much more focus than campaign talking points.

The real solution would be to create a tax environment more favorable to businesses in this country. Fortunately, the administration and many congressional Democrats agree with me on this basic idea, though there are disagreements on important details. But absent such reform, which I acknowledge is unlikely in the short term, there may be a way to address inversions in a bipartisan manner, if we follow four simple principles.

First, it is imperative that any such interim proposal be a bridge to our ultimate solution to address the cause of the problem: our obsolete tax code.

Second, any interim proposal should not be retroactive. Imposing arbitrary retroactive restrictions would further complicate the goal of comprehensive tax reform and impose additional burdens on U.S. businesses.

Third, the approach should move us toward a territorial tax system, whereby businesses would be taxed only on what they earn within the United States, and should not enhance the bias in favor of foreign takeovers.

Finally, and most important, any interim proposal must be revenue neutral.


story continues below
story continues below

Orrin Hatch, a Republican, represents Utah in the Senate and is the ranking member on the Senate Finance Committee.



Copyright 2014 The Salt Lake Tribune. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Top Reader Comments Read All Comments Post a Comment
Click here to read all comments   Click here to post a comment


About Reader Comments


Reader comments on sltrib.com are the opinions of the writer, not The Salt Lake Tribune. We will delete comments containing obscenities, personal attacks and inappropriate or offensive remarks. Flagrant or repeat violators will be banned. If you see an objectionable comment, please alert us by clicking the arrow on the upper right side of the comment and selecting "Flag comment as inappropriate". If you've recently registered with Disqus or aren't seeing your comments immediately, you may need to verify your email address. To do so, visit disqus.com/account.
See more about comments here.
Staying Connected
Videos
Jobs
Contests and Promotions
  • Search Obituaries
  • Place an Obituary

  • Search Cars
  • Search Homes
  • Search Jobs
  • Search Marketplace
  • Search Legal Notices

  • Other Services
  • Advertise With Us
  • Subscribe to the Newspaper
  • Access your e-Edition
  • Frequently Asked Questions
  • Contact a newsroom staff member
  • Access the Trib Archives
  • Privacy Policy
  • Missing your paper? Need to place your paper on vacation hold? For this and any other subscription related needs, click here or call 801.204.6100.