The Tax Cuts and Jobs Act was supposed to stop corporate tax dodgers. It didn’t, study says – By Aimee Picchi (CBS News) / July 8 2021
A key selling point of the 2017 Tax Cuts and Jobs Act was that it would discourage multinational corporations from funneling billions in profits to offshore tax havens, bringing that money back to the U.S. where it could create jobs and boost economic growth. But a recent analysis concludes that the tax overhaul failed to stem the flow of corporate earnings overseas.
The study, by Javier Garcia-Bernardo and Petr Janský of Charles University in Prague and Gabriel Zucman of the University of California, Berkeley, found that the TCJA had little impact on the share of foreign income booked by U.S. companies in tax havens like Bermuda and Ireland. From 2015 to 2020 — the years before and after the law took effect — that share held steady at about 50%.
“For decades, Congress has been playing catch-up as business owners and a handful of tax havens have driven international tax policy,” Zucman, a noted expert on inequality, wrote this week in a New York Times op-ed that summarized the findings.
He added, “The result has been a nation where working-class Americans are left with underfunded public schools and hospitals as the wealthy board rocketships to outer space.”
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