eSignature Alaska Finance & Tax Accounting Credit Memo Now
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How to get joint tax return? Read more
The new version of the US tax code includes a tax on all US residents' international travel to countries that do not tax such activity. The bill, which is scheduled for a floor vote soon, imposes a 10% levy on those who travel to or spend time in countries with which the US does not have a tax treaty.
The idea is to get money, which is now going out of the country to lower-tax countries, back into the US. But a group of US Senators and representatives, as well as the US Treasury Department's top foreign tax policy official, think this move is a terrible idea for two reasons.
First, they say a 10% tax in a country that doesn't charge an equivalent tax doesn't raise much money.
The Treasury Department's deputy assistant secretary for international tax affairs has told Congress that the tax, which could hit people traveling to New York for a weekend of Broadway shows, would raise less than $30m a year.
The money would go to reducing the US corporate tax rate which is one of the lowest in the world.
"There's no doubt the 10% tax is something that is being talked about and there will be a debate on it," said David Wilkins, senior economist with the Tax Foundation , "but it's not going to be the kind of conversation most are expecting to have."
Mr Bratton is more convinced. In 2014 he wrote a study for the American Enterprise Institute, a right-wing think-tank, arguing that the 10% tax would raise $500m a year.
The US already has a si...
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