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Anne Swope, et al. Introducing the Homeland Investment Act, J. P. Morgan, April 2003 (morganmarkets.com)
There is a tax reform that is relatively simple and low in cost, yet might have a positive effect on the United States economy as great as President Bush's tax plans, say four researchers from a leading investment house. The plan, called the Homeland Investment Act, would tweak American tax laws to make it easier for companies to reinvest profits earned abroad.
Currently, if a U.S. corporation owns a foreign subsidiary that makes a profit and wishes to pay back those profits to the American firm as a dividend, the federal government taxes the dividend at a 35 percent rate. This provides a huge disincentive to firms to bring their money back to the U.S. Consequently, foreign profits are most often used to reinvest in foreign countries. Our tax policy thus pushes American companies to invest abroad rather than at home.
The Homeland Investment Act would allow firms to ...
Source: HighBeam Research, A boon awaiting. (Business and Economics).(Brief Article)