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Opinion
Ramesh Ponnuru

Obama Is Inverted on Inversions

Obama's new fix for tax inversions misses the bigger problem. We should lower taxes on business investment instead.
Please stay.
Please stay.

Corporate inversions -- when American companies reincorporate abroad to lower their tax bills -- have become a political controversy solely because of the screwiness of the U.S. tax system. If our government taxed companies based on their consumption, or on the income they make on U.S. territory, or on where their shareholders live, then the place where they were chartered would have no tax consequences.

Our government has instead decided to tax the worldwide profits of companies chartered in the U.S., and is then shocked that companies prefer to move their charters elsewhere.