Stopped Clock: Republican Tax Plan Edition

In an otherwise anodyne New York Times article about various sources of opposition to Republican tax plan, and they reveal a good idea buried in their black hearted evil plans. Needless to say, large multinationals hate the proposed excise tax on payment made to a company's foreign affiliates:

That may be an uphill battle, as key groups begin coming out in opposition to parts of the bill, including a proposed excise tax of 20 percent on payments made by American companies to foreign affiliates. The provision is aimed at preventing American companies from shifting profits abroad through payments, such as royalties, made to subsidiaries or other foreign affiliates.

American multinational corporations are especially concerned about the proposal, which would raise just more than $150 billion over a decade. They say the tax will wind up harming American companies and their consumers.

The American Forest and Paper Association said it was “very troubled” by the provision, which it said “would lead to massive overcollection of tax in the United States.” The provision is also coming under fire from pharmaceutical companies and the small-government advocacy groups spearheaded by the billionaire Republican megadonor brothers Charles G. and David H. Koch, who are trying to generate opposition to the excise tax from other conservative groups.

………

Mr. [Kevin] Brady [House Ways and Means Committee chairman] said lawmakers are working with multinational companies to address their concerns. “But make no mistake,” he said, “we have to have safeguards in place so that companies aren’t encouraged to shift their earnings and their profits offshore and to low-tax havens, and we need strong guardrails to make sure they’re not importing deductions, exclusions and other tax rate issues.”

My heart bleeds borscht for these folks.

They assign their IP to a foreign subsidiary in the Caymans, or the Isle of Mann, or Ireland, and pay "royalties", and voila, no taxes paid.

Of course, this will be dropped in conference committee, because, of course, tax evading job cutting multinationals are the Republican political base, but this is actually good idea.

Pay attention.  It's likely to be a long time before the Republicans get an element tax policy right.