Jobs or Taxes?

I’ll take jobs…

Apple CEO Tom Cook became my new hero when, in response to the European Commission’s ruling that Apple “owes” Ireland almost $15 billion in  taxes, he said:

You can have taxes or you can have jobs, but Apple is in no mood to deliver both.

What really makes the EU’s decision galling is that Ireland’s government agreed to give Apple a lower tax rate in order to attract Apple’s business!

So the EU is trying to stop Ireland from lowering taxes. Their justification for treading on Ireland’s sovereignty in the name of increasing taxes is that Ireland’s action “deprives” other EU countries of tax revenue.

And they wonder why people voted for Brexit?

The EU does have a point. In the ideal world, countries would not offer special tax breaks to certain companies. But that should not be because, as the EU wishes, every country is forced by an international bureaucracy to impose the same high tax rates on everyone.

Instead, it is because taxes are low, or non-existent, in every country so that investment and employment decisions are based solely on market considerations, not on how the company can lower its taxes .

While this seems to be solely a European issue, here a few things the US government can do to protect American companies (and American investors) from the global tax police: First, the US government can stop subsidizing international organizations that advocate for higher taxes around the globe. 

Secondly, they can reduce and eliminate tax rates on businesses and individuals. One good place to start is adopting a “territorial” tax system. A territorial system where counties are only taxed on income actuality earned in that country. This would stop tax-hungry bureaucrats from trying to extend their reach overseas.

Congress should also allow companies to repatriate capital without facing punitive taxes. This would bring in trillions in new investments. Reparations was part of Campaign for Liberty Chairman Ron Paul’s Restore America Now Budget plan.