"Summer Lovin': Trade and Tax Reform Discussions Heat Up"
The current tax code was not built to properly account for such free movement of people, services and capital across boarders, which is why the leading Republican proposal promoted by House Speaker Paul Ryan to modernize the U.S. tax system, called “A Better Way,” or more commonly the House “Blueprint,” has introduced the idea of repealing the corporate income tax and replacing it with a Destination Based Cash Flow Tax (DBCFT). The idea behind the DBCFT is to change the focus from taxing businesses from an “origin based” system, in which goods and services are taxed based on the domicile of company, to a “destination based” system, in which tax is levied based on where the product or service is actually consumed or sold. By shifting the focus of taxation to the customer base, which is less mobile and more easily defined than determining the citizenship of a multinational entity, proponents of the proposal believe that the DBCFT is more efficient, easier to administer, and less prone to tax evasion than the current system.
Click here to read the entire article in the Cleveland Metropolitan Bar Journal.