Wednesday, September 24, 2014

During an interview with CNBC on Tuesday, former President Bill Clinton called to cut corporate taxes and give companies a break on money stashed overseas, dinging President Barack Obama’s latest effort to combat corporate tax-dodging.

When asked what should be done about corporate inversion transactions, Clinton responded with a host of GOP talking points about the tax burden on big business.

“America has to face the fact that we have not reformed our corporate tax laws,” Clinton told CNBC, according to a transcript. “We have the highest overall corporate tax rates in the world. And we are now the only OECD country that also taxes overseas earnings on the difference between what the companies pay overseas and what they pay in America.”

Corporate inversions are transactions in which an American company acquires a foreign firm in order to change its formal address for tax purposes. Being officially headquartered abroad allows a firm to load up its U.S. operations with debt and avoid paying taxes on its domestic activities. On Monday, Treasury Secretary Jack Lew introduced a host of regulatory efforts designed to discourage inversions by making them less profitable, although Lew acknowledged that more-effective measures would require congressional action.

“Everything we are doing now, including these inversion rules, I have no problem with,” Clinton added. “I understand the Treasury Department is legally obligated to get as much revenue as is owed that they can collect. But we are bailing water out of a leaky boat.”

Bill Clinton’s words, fairly or not, are closely associated with a potential presidential run from his wife, former Secretary of State Hillary Clinton. The burgeoning populist wing of the Democratic Party will see his comments as evidence that Hillary Clinton will pursue a conservative, corporate-friendly economic policy agenda.

Bill Clinton also called to “give incentives to repatriate … nearly $ 2 trillion overseas,” suggesting that the U.S. grant a tax holiday on money deliberately kept out of the country to avoid paying U.S. taxes on it.

The United States does have a relatively high official corporate tax rate, but it also has a byzantine network of loopholes and exemptions. A 2013 report by the Government Accountability Office found that U.S. corporations pay an average effective rate of just 12.6 percent, a rate in line with or below that of most developed countries.

Clinton eventually suggested the Treasury could “collect at least as much money as we’re collecting now” if Congress closed a host of loopholes while simultaneously cutting the overall rate. This is true, but it is inconsistent with his broader call to ease the corporate tax burden to prevent companies from inverting to escape American taxes.

The House Ways and Means Committee approved a corporate tax reform bill early this year, but House GOP leadership has not brought it to the floor for a vote. Although Obama had called for “revenue-neutral” corporate tax reform — leaving the overall tax burden the same while lowering rates and closing loopholes — he has not put much political capital behind the proposal.
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In 2013, Diddy topped Forbes’ list of highest paid hip-hop acts with $ 50 million, leading Dr. Dre, who landed in third, by $ 10 million. But after Apple dished out $ 3 billion to purchase Beats, Diddy has been unseated as Dre rocketed to the top of this year’s hip-hop cash kings with an incredible total of $ 620 million (it will take a little more time for him to hit nine figures). It’s so much money that Dre’s income exceeds the total sum of all earnings for the 24 others on this year’s list.

“It’s safe to say headphones is a good business,” DJ Khaled said in a video announcing the top five on Forbes’ list.

Following Dre is a tie for second place between Diddy and Jay Z, each earning $ 60 million. In fourth place, Drake raked in $ 33 million, an impressive leap from his 11th spot in 2013. In fifth place, Macklemore & Ryan Lewis garnered a cool $ 32 million, jumping ahead 10 spots and more than tripling their earnings since 2013. Here are 2014′s top 10:

1. Dr. Dre – $ 620 million
2. Jay Z – $ 60 million
2. Diddy – $ 60 million
4. Drake – $ 33 million
5. Macklemore & Ryan Lewis – $ 32 million
6. Kanye West – $ 30 million
7. Birdman – $ 24 million
8. Lil Wayne – $ 23 million
9. Pharrell Williams – $ 22 million
10. Eminem – $ 18 million

For the full list and more information about the Hip-Hop Cash Kings of 2014, head over to Forbes.
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