Max Baucus: “this may sound like a good idea, but it isn't. There are a lot of reasons. First, it is a question of fairness, fairness…”

“this may sound like a good idea, but it isn't. There are a lot of reasons. First, it is a question of fairness, fairness to American companies that do their business in America compared with American companies that do their business in America and maybe significantly overseas. If you are an American company and you are doing business in America, let's say you are doing pretty well. You pay the standard 35-percent corporate rate; that is, if you are an American company. If you are an American company but you have significant overseas operations, subsidiaries and businesses in the Cayman Islands and other offshore entities, under this bill you don't pay that 35-percent rate that the American company pays that is doing business. You pay a much lower rate under this bill and basically pay 5 percent. I think that is about it. So on the first level, this is totally unfair. Here we are, an American company doing business in America. We have to pay the full 35-percent corporate tax rate compared with companies that have significant revenues overseas. They bring it back to the United States, and they only pay 5 percent. These are companies that are taking advantage of the current tax laws by bringing it home, especially bringing back home repatriated income. Under our tax laws, income by an American company earned overseas, active income, is not taxed unless it is brought home to the United States.”