Should the United States Exempt Foreign-Source Income Similar to Foreign Business Partners?

by Amanda Pintaro April 5 2010, 18:53
In 1918, the United States enacted a foreign tax credit (FTC) system for taxing foreign-source business income earned by multinational corporations (MNCs). This system, known as “worldwide” taxation is said to implement “capital export neutrality” by neutralizing a citizen’s decision between investing domestically or abroad. About half of the Organization for Economic Co-operation (OECD) countries have adopted a similar approach. However, as foreign trade agreements and the complexity of U.S. tax treatment continue to increase, a “territorial” taxation system, as implemented by the other half of OECD countries, might be worth considering in the United States.

This article will 1) define some of the underlying principles behind international tax policies, 2) suggest a proposal for a tax-exemption system, 3) explain how the proposal solves problems under the current system, and finally 4) attempt to rationalize potential criticisms surrounding an exemption system. [More]

Plug the Leak: Employee Turnover- A Consequence of Discriminatory Behavior?

by Amanda Pintaro September 20 2009, 18:06
What does employee turnover look like these days? Well, much like pouring liquid into a sieve- analogous to employees passing through a company much too rapidly. According to the Bureau of Labor Statistics, which collects and compiles monthly data on a sampling of business establishments, the total number of employees who left their jobs exceeded those being hired from July 2008 through June 2009. “Over the 12 months ending in June, hires totaled 51.8 million and separations totaled 57.1 million, yielding a net employment loss of 5.3 million.” The increasing problem of employee turnover seems to revolve around two vital issues. Companies do not fully understand what causes employee turnover, and they do not know how to go about correcting the problem. This article will discuss: 1) the costs and causes of employee turnover; 2) the methods by which different companies have approached the problem; and 3) how excessive employee turnover can be a direct result of conscious or unconscious discriminatory behavior by employers. [More]

Nationalized Treasure

by Patrick Schuette April 6 2009, 05:24
I. Introduction

On February 27, 2009, the United States government announced that it was taking measures that could result in it taking as much as a 36% equity stake in Citigroup, Inc.[1] This would make the federal government the largest shareholder in Citibank.[2] By converting $25 billion in preferred shares into common stock, the federal government hoped that the move would stabilize Citibank in a tumultuous market.[3] As a result of this move, a number of people have voiced a growing concern over the federal government taking further steps to nationalize other major financial institutions.[4] [More]

Tamed Tigers: Sovereign Wealth Funds as Passive Investors

by Patrick Schuette November 3 2008, 00:26
I. Introduction

The purpose of this article is to analyze the current role of sovereign wealth funds in a corporate governance scheme. Sovereign wealth funds, which have become increasingly important institutional investors in the United States, have found their activities in equities markets in the United States increasingly constrained due to stringent regulations. While these sovereign wealth funds raise important policy considerations for lawmakers, these regulations hinder sovereign wealth funds in their role as investors. Despite the power the sovereign wealth funds could hold in American companies, these funds have effectively become “tamed tigers.” Despite their enormous power, they simply cannot exercise it. Thus, this article will examine whether having sovereign wealth funds in a “tamed tiger” capacity should continue or whether regulations should encourage more activity from sovereign wealth funds. [More]

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