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Global Tax War

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Tax Scheme Ignites Global Tax War
Other Countries Have Already Launched a ‘Race to the Bottom’ to Undermine New U.S. Corporate Tax Cuts
By James S. Henry, DCReport Senior Editor, Investigative Economics


Before Donald Trump has signed the new tax law, there are already troubling signs that it is the first shot in a global tax war that threatens working people and the public pensions plans that sustain them in old age.
The Trump bill has already triggered an aggressive “race to the bottom” in international corporate tax rates, rules and regulations.
What the mainstream American news has failed to notice are the global responses, including:

  • Australia’s Finance Minister warned that its economic growth rate might fall by a third unless it responds fast to the Tax Cut legislation. Accordingly, he promised that Australia will soon slash its own corporate tax rate from 30% to 25%. He said even that rate may be too high.
  • In Europe, Austria’s new government just announced that it is considering a similar reduction.
  • Norway cut its 25% corporate income tax rate to 24% this month. More cuts may be coming.
  • France’s corporate tax rate will be cut from 33% to 27% by 2022.
  • Britain moved preemptively last April, cutting its corporate rate from 20% to 19% with plans to reduce it to 17% in 2020.
  • South Korea, Mexico and Chile are also actively considering corporate tax cuts, in response to the US measure.


Just this week, Argentina’s conservative President Mauricio Macri—who reportedly maintains close ties with the Trump—announced plans to cut Argentina’s corporate tax rate from 35% to 25% by 2020.
The Argentinean corporate tax cuts are especially troubling because they may well turn out to be an ominous precursor for what may happen to Social Security in America.

 

http://abcnews.go.com/International/wireStory/clashes-argentina-congress-debates-pension-reform-5186...

 

In Washington, Congressional Republicans have tried for years to weaken Social Security and undermine its finances in the hopes they can kill the most popular social support program in the country. They are expected to step up their efforts to weaken Social Security, arguing that with the tax cut legislation there just isn’t enough money to sustain the social safety net.

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