Last year the Biden administration and the 50-50 Senate managed to get through the Inflation Reduction Act ("IRA"). One aspect taht wasn't talked about a lot wa

Last year the Biden administration and the 50-50 Senate managed to get through the Inflation Reduction Act ("IRA"). One aspect taht wasn't talked about a lot was the 15% minimumn corporate tax [1]. The US likes these alternatigve minimum taxes when it collectively throws its hands up int he air and says it's too complicated. Now this faced some opposition but on the messaging front it was hard to argue gainst it because you simply say (as people did) "the corporate tax rate is 21%, why does it matter that there's a minimum of 15%?" Of course, we all know the answer: companies will be paying less than 15% tax or they wouldn't care. Now this is all still too low but it's something. Personally what I think we need is to go after profit shifting. Interestingly, "transfer pricing", which is basically the exact same thing, is illegal, but profit shifting isn't (because reasons). What is it? Acme Inc produces widgets in China for $100 including shipping and sells them in the US for $200. That's a taxable profit of $100. So instead Acme Inc sets up a subsidiary in Ireland. That subsidiary buys them for $100 and sells them to the US subsidiary for $195. That's now $5 taxable profit in the US and $95 low to no tax profit in Ireland. So how do we go after it? Simple. Revenue apportionment. If you, as a multinational, make 35% (for example) of your revenue in the US then 35% of your conglomerate's profit gets taxed in the US. Google and Meta do this too. Ad contracts in the UK are booked in Ireland. The UK subsidiary makes nothing. Ireland makes all the profits. The other aspect to this which is idiotic is IP transfer [1]. Say you're Google and you invent a search engine. Well, you value that IP at $X and transfer it to an Irish subsidiary. You then pay royalties to yourself to use that IP. There are rules around what you can do here but it's an essential part of Big Tech companies shifting profits to tax havens. [1]: mhttps://www.williamfry.com/knowledge/ireland-as-the-jurisdiction-of-choice-for-intellectual-property-rights/ https://www.williamfry.com/knowledge/ireland-as-the-jurisdic... [1]: https://www.irs.gov/newsroom/irs-clarifies-rules-for-new-corporate-alternative-minimum-tax https://www.irs.gov/newsroom/irs-clarifies-rules-for-new-cor...