Press watch: US tax inversions

The Financial Times has reported (14 September) that hopes for a bipartisan deal on US tax inversions are fading. ‘While both Republicans and Democrats have criticised the arrangements, the discord between the two parties over how to tackle them has grown in recent days,’ the newspaper said, adding that aides were warning that Congress will not be able to legislate before the midterm elections.

Also in the FT (16 September), Mort Zuckerman, executive chairman of Boston Properties and chairman and editor-in-chief of US News & World Report, wrote the numbers of companies opting to invert ‘will increase at breakneck speed, eroding our tax base to the point where it damages the prospects of comprehensive tax reform’.  He wrote that solutions were not hard to find: ‘Here is one modest proposal: how about marrying a lower corporate rate – 30%, say – with restricting inversions to cases where it is a genuine business move? A company could still be subject to US taxes if management control remains in America and 25% of its employees, sales or assets stay there.’