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{"source_url": "https://www.salon.com", "url": "https://www.salon.com/2020/01/01/trump-administration-is-quietly-gutting-tax-law-to-give-big-new-breaks-to-corporations/", "title": "Trump administration is quietly \u201cgutting\u201d tax law to give big new breaks to corporations", "top_image": "https://media.salon.com/2019/12/steve-mnuchin-12311.jpg", "meta_img": "https://media.salon.com/2019/12/steve-mnuchin-12311.jpg", "images": ["https://www.salon.com/design/images/salon_logo.svg", "https://q.quora.com/_/ad/c63001bb8054442db2dc1a48b7b1fd7e/pixel?tag=ViewContent&noscript=1", "https://media.salon.com/2019/12/steve-mnuchin-12311.jpg"], "movies": [], "text": "The Trump administration quietly used loopholes built into the 2017 tax cuts to give big corporations an even bigger tax savings.\n\nThe tax cut bill passed by Republicans in 2017 overwhelmingly benefited the wealthy and big corporations, according to a House Budget Committee report issued earlier this year. The law gave individuals a modest short-term tax cut while permanently slashing corporate taxes from 35 percent to 21 percent. The new law has greatly contributed to the 50 percent growth in the budget deficit since President Trump took office.\n\nAdvertisement:\n\nBut that was not enough for big corporations, which launched intense lobbying efforts to carve out even bigger breaks in the bill\u2019s loopholes. The effort led the Treasury Department to quietly change rules to hand big companies an even bigger tax break, according to The New York Times , costing taxpayers billions in lost revenue.\n\n\u201cTreasury is gutting the new law,\u201d University of Houston tax law professor Bret Wells told the Times. \u201cIt is largely the top 1 percent that will disproportionately benefit \u2014 the wealthiest people in the world.\u201d\n\nRepublicans used budget reconciliation, a congressional process that allowed the Senate to pass the tax cuts with 51 votes instead of 60. But that process requires a bill that will contribute less than $1.5 trillion to the deficit over 10 years, so Republicans decided to offset the cost of the corporate tax cut by eliminating a wide range of corporate deductions and introducing new taxes.\n\nAdvertisement:\n\nOne of the biggest new taxes was the \"base erosion and anti-abuse tax,\" or BEAT , which aimed to cut down on foreign companies with large American operations avoiding US taxes by sending their profits to countries with lower tax rates. The other was a provision on \"global intangible low-taxed income,\" or GILTI , which imposed a tax up to 10.5 percent on some offshore income.\n\nThe Joint Committee on Taxation estimated that these two new taxes would add $262 billion in revenue over the next decade, which the Times noted would be enough to fund the entire Treasury Department, the Environmental Protection Agency and the National Cancer Institute for 10 years.\n\nBut the new taxes also featured many loopholes, and \u201calmost immediately\u201d after Trump signed the tax bill, companies launched an aggressive lobbying effort to carve out breaks for themselves in the law, the Times reported.\n\nAdvertisement:\n\nChip Harter, a longtime tax attorney who advised companies on how to avoid taxes \u2014 before being appointed as the Treasury official in charge of writing rules regarding the new taxes \u2014 and his team \u201cfound themselves in nonstop meetings \u2014 roughly 10 a week at time \u2014 with lobbyists\u201d from those companies, according to the Times report. Many of the lobbyists were from the same firms that Harter had previously worked for.\n\nEarlier this month, the department released the final version of some of the BEAT rules that allowed companies to use a \u201ccomplex currency-accounting maneuver\u201d to avoid paying the tax, according to the Times, giving the lobbyists what they had pushed for.\n\nAdvertisement:\n\nForeign banks like Barclays and Credit Suisse also staged an aggressive lobbying effort to carve out an exemption in the BEAT law. The lobbyists included Erika Nijenhuis, who represented the Institute of International Bankers. Harter got Treasury Secretary Steven Mnuchin to approve new exemptions for the banks earlier this year, before the tax office announced even more exemptions. In September, Nijenhuis was appointed to a job at Treasury's Office of Tax Policy.\n\nOfficials at the Joint Committee on Taxation projected that the exemptions for international banks alone would cut revenue by up to $50 billion.\n\nAll told, BEAT is only likely to collect \u201ca small fraction\u201d of the $150 billion projection, tax adviser Thomas Horst told the Times.\n\nAdvertisement:\n\nThe department made the moves even as Treasury officials warned Harter that it may lack legal authority to exempt bank payments from the law. Harter dismissed the objections, according to the Times.\n\n\u201cWe thoroughly reviewed these issues internally and are fully comfortable that we have the legal authority for the conclusions reached in these regulations,\u201d a Treasury Department spokesperson told the Times.\n\nCompanies like Procter & Gamble, News Corp., Comcast, Liberty Mutual and Anheuser-Busch also launched an intense lobbying effort to exempt themselves from GILTI. After months of meetings with lobbyists, the department announced the rules that the companies had pushed for in June.\n\nAdvertisement:\n\nAs a result, companies \u201ccontinue to shift hundreds of billions of dollars to overseas tax havens\u201d and the IRS is collecting tens of billions less in revenue than Congress projected, the Times reported. In 2018, the United States lost more tax revenue than any other developed nation, according to the Organization for Economic Cooperation and Development .\n\nBut big companies may have even more tax breaks coming.\n\n\u201cIn the coming days, the Treasury is likely to complete its last round of rules carrying out the tax cuts,\" the Times reported. \u201cBig companies have spent this fall trying to win more.\u201d", "keywords": [], "meta_keywords": [""], "tags": ["Steven Mnuchin", "Donald Trump", "Trump Tax Cut", "Chip Harter", "Politics", "Taxes", "All Salon", "Brief", "Tax Cuts", "Gop Tax Cuts", "Trump Tax Cuts", "Treasury Department", "Republican Tax Cuts", "News & Politics"], "authors": ["Igor Derysh"], "publish_date": "Wed Jan 1 00:00:00 2020", "summary": "", "article_html": "", "meta_description": "Treasury will use loopholes in the tax bill to offer giant corporations more breaks worth tens of billions", "meta_lang": "en", "meta_favicon": "/apple-touch-icon.png", "meta_data": {"description": "Treasury will use loopholes in the tax bill to offer giant corporations more breaks worth tens of billions", "apple-itunes-app": "app-id=549374205", "viewport": "width=device-width, initial-scale=1", "msapplication-TileColor": "#000000", "theme-color": "#ffffff", "mobile-web-app-capable": "yes", "apple-mobile-web-app-capable": "yes", "apple-mobile-web-app-status-bar-style": "black", "apple-mobile-web-app-title": "Salon.com", "fb": {"pages": 120680396518, "app_id": 456294607741273}, "p": {"domain_verify": "afd252c603232fed8ddf2554b144079b"}, "twitter": {"title": "Trump admin \u201cgutting\u201d tax law to give corporations bigger cut", "description": "Treasury Department uses loopholes in tax bill to gift huge corporations another break worth tens of billions.", "image": "https://media.salon.com/2019/12/steve-mnuchin-12311.jpg", "site": "@Salon", "card": "summary_large_image", "creator": "@Salon"}, "og": {"title": "Trump administration quietly \u201cgutting\u201d tax law to give big corporations even bigger tax breaks", "site_name": "Salon", "description": "Treasury Department uses loopholes in tax bill to gift huge corporations another break worth tens of billions.", "image": "https://media.salon.com/2019/12/steve-mnuchin-12311.jpg", "url": "https://www.salon.com/2020/01/01/trump-administration-is-quietly-gutting-tax-law-to-give-big-new-breaks-to-corporations/", "locale": "en_US", "type": "article"}, "article": {"published_time": "2020-01-01 06:00:04", "modified_time": "2019-12-31 20:40:53", "publisher": 120680396518, "section": "News & Politics", "tag": "Trump tax cuts"}, "parsely-title": "Trump administration is quietly \u201cgutting\u201d tax law to give big new breaks to corporations", "parsely-link": "https://www.salon.com/2020/01/01/trump-administration-is-quietly-gutting-tax-law-to-give-big-new-breaks-to-corporations/", "parsely-type": "post", "parsely-image-url": "https://media.salon.com/2019/12/steve-mnuchin-12311-150x150.jpg", "parsely-pub-date": "2020-01-01T11:00:04Z", "parsely-section": "News & Politics", "parsely-author": "Igor Derysh", "parsely-tags": "All Salon,Brief,Chip Harter,Donald Trump,GOP tax cuts,News & Politics,Politics,Republican tax cuts,Steven Mnuchin,Tax cuts,Taxes,Treasury Department,Trump Tax Cut,Trump tax cuts"}, "canonical_link": "https://www.salon.com/2020/01/01/trump-administration-is-quietly-gutting-tax-law-to-give-big-new-breaks-to-corporations/"} |
