There are so many low-income-taxed foreign tax havens that many Big US
Multinational Corps and Foreign Corps use. Among these are:
Cayman Islands
Bermuda
Ireland
Netherlands Antilles
Luxembourg
Bahamas
British Virgin Islands
Switzerland
Barbados
Singapore
Jersey
Marshall Islands
By
shifting a huge amount of their worldwide earnings into low-tax foreign
tax havens, these multinational corps can substantially increase their
worldwide consolidated after-tax net income.
In addition, by
using foreign tax havens, these multinational corps are also able to
increase their ability to use their foreign tax credits on a worldwide
basis.
My proposal here is that the US Government "Economic
Substance Doctrine" (economic substance over legal form) should apply to
situations where, even though a corporation is legally incorporated in
one of the foreign tax havens, if its management and control is located
predominately in the US or predominately in a US Corporation's foreign subsidiary which is not a foreign tax haven, then this corporation incorporated in a foreign tax haven cannot claim foreign
corporation status for US federal income tax purposes.
All of the tax proceeds from closing this substantial Big Corp Tax Loophole should be used to reduce the US Debt.
