My old friend and former Joint Committee on Taxation Foreign Team colleague Patrick Driessen, no longer on staff, emails:
“I just congratulated a former JCT attorney for assisting on an inversion. I told him that, notwithstanding what Secretary Lew just said, anybody helping to complete an inversion IS being a real patriot, on the theory that If we only have 10 more inversions this year, then we get something like the Levin bill which is at best a 7874 bandaid. But if we get 25 more inversions this year, people will start looking at formulary and tell the lawyers to find a new sacred cow — other than transfer pricing, and with 50 more inversions this year, we get what I really want, which is to abolish the corporate tax, raise the individual income tax rates at the top, put in a VAT with a demogrant, and tighten the estate and gift tax (including policing the many phony self-glorifying foundations out there). But of course this is only amusing to me because I don’t have to work on any of the associated yellow tickets [requests to estimate tax proposals].”
I’m with him most of the way, but would add a carbon tax, and a tax on marijuana, and I would increase and index other excises. And about abolishing the corporate tax – I wouldn’t go that far. Not all limited liability entities pay tax. As another old Joint Tax friend put it, if you’re small and active (Sub S, etc.), there’s no tax. If you’re large and passive (mutual funds, REITs, etc.) there’s no tax. But society agreeing to let enterprises limit liability is worth plenty to those enterprises. Let ’em pay something, I suggest.
Update: Billionaire Mark Cuban points out that if inversions aren’t dealt with, other people’s taxes will go up.