Growing support for lower corporate rate and territorial system

On 10/30/13, Senator Baucus issued a statement about the merger of California-based Applied Materials (manufacturer of semiconductor manufacturing equipment) with Tokyo Electron along with the reincorporation of the entity in the Netherlands. He referred to information from an October 8 New York Times article. Baucus noted that Applied Materials effective tax rate will decrease from 22% to 17%, saving about $100 million annually.

Baucus also observes that this type of restructuring is "a new spin on the old “inversion” problem.  And it’s becoming an increasingly popular practice."

Finally, he observes: "This is a simple issue. Globalization has made America’s tax code out of date."

October also brought us a report from the Joint Committee on Taxation - Modeling the Distribution of Taxes on Business Income (10/16/13). It analyzes the age-old question of who bears the burden of corporate taxes.  Well, to the extent some of it is borne by workers, that broadens the group of politicians interested in lowering the corporate tax rate.

And, we await the release of a tax reform mark-up from both tax committees.

What do you think should happen with the corporate tax rate and what it means for other forms of business?