In March, Vice President Joe Biden floated a tax proposal known as the global minimum tax while campaigning in Iowa. The proposal, a feature of President Obama’s budget aimed at companies that use offshore tax havens to reduce the amount they pay in income taxes, would force multinational corporations based in the United States to pay a minimum tax rate, thereby adding trillions in lost revenue that is shifted to individual taxpayers and small businesses.
At the time, presumptive Republican presidential nominee Mitt Romney slammed Biden’s proposal. “Instead of promoting pro-growth tax policies that provide businesses with the economic freedom to grow and prosper, he is backing a ‘global tax’ that would harm American competitiveness,” Romney said. At a campaign stop in Portsmouth, New Hampshire yesterday, however, Romney feigned ignorance of the proposal:
ROMNEY: And the vice president says he wants to do a global tax on multinationals. Not sure what that is, but it doesn’t sound very good.
Under the global tax plan, the 26 corporations that haven’t paid taxes in the last four years would actually have to pay taxes. So would Apple, which used offshore tax havens to dodge $2.4 billion in taxes last year. Romney’s plan, by contrast, would cut corporate taxes and the tax on profits corporations bring from overseas. His justification: America’s high corporate tax rate hurts competitiveness, and the lower repatriation rate will boost job growth. In reality, American corporations pay one of the world’s lowest tax rates, and the last repatriation holiday was a complete failure.
It’s no secret why Romney doesn’t want to talk about the global minimum tax. While his plan would provide a massive giveaway to American corporations, the plan Biden floated would actually raise corporate tax revenues — something a vast majority of Americans support.