A Beginners Guide to Avoiding Taxes
Imagine yourself being able to get out of paying taxes. Day in and day out you sit comfortably as your wallet begins to grow. What’s the catch, you might ask? The only catch is that you have to renounce your United States citizenship and take up residence in another country. That doesn’t sound like that bad of a trade off to get out of paying taxes. Unfortunately, this is not possible on an individual level but, however, is possible with regards to large corporations in the United States. Every day, through a process known as corporate inversion, large corporations from the United States take advantage of a loophole in the US tax code that allows them to get out of paying their corporate income taxes to the US. Do any of the potential benefits that corporate inversion might actually bring outweigh any of the potential costs? I believe that large corporations moving their headquarters to another location outside of the US to avoid corporate …show more content…
A typical corporate inversion does not lead to a loss of American jobs because the corporation still keeps employees in its offices in the US (Pomerleau, “Everything You Need to Know…”). Corporate inversions might actually be beneficial to employees in the US because they may see increased wages or even an increase in jobs through the company’s savings by moving its headquarters to another country with a lower tax rate since it would have less of a tax burden to worry about (Pomerleau, “Everything You Need to Know…”). The counterargument also says that corporate inversions would only cost about 0.5 percent of the corporate tax base over the next ten years (Pomerleau, “Everything You Need to Know…”). From this perspective, it would seem that corporate inversions would appear to be only a metaphorical drop in the bucket and that they would not amount to that great of a loss in