Paul L. Caron
Dean




Thursday, January 24, 2008

Fleming Presents Some Perspectives from America on the Worldwide Taxation vs. Territorial Taxation Debate Today in Australia

J. Clifton Fleming, Jr. (BYU) presents Some Perspectives from America on the Worldwide Taxation vs. Territorial Taxation Debate (with Robert J. Peroni (Texas) and Stephen E. Shay (Ropes & Gray, Boston)) at the 20th Annual Australasian Tax Teachers Association Conference on Tax:  The Devil's in the Details today in Hobart, Australia.  Here is the abstract:

Because of political gridlock and lack of enthusiasm by the business community, the prospects of the United States moving from its hybrid worldwide system for taxing income to an explicit territorial (exemption) system are not good. Nevertheless, in the United States, the subject of worldwide taxation v. territorial taxation has recently generated two high-level government proposals and a lively academic and political debate. In this paper, my co-authors and I attempt to share the outlines of this controversy with our Australasian colleagues while arguing the merits. We concede that a well-designed exemption system is superior to the badly-flawed worldwide system currently operated by the U.S. We argue, however, that the proper way to frame the debate is to ask whether an exemption system is superior to a worldwide system where both are well-designed. We conclude that when the debate is so framed, efficiency and fairness concerns indicate that the prize should be awarded to worldwide taxation. We critique the competitiveness rationale that serves as the principal justification for exemption systems and find it wanting. We also critique the ownership neutrality defense of territorial taxation that has been recently developed in the United States by Professors Desai and Hines. We conclude that this defense is simply a slightly tweaked version of the competitiveness rationale and shares its flaws.

For a list of speakers and their topics, including abstracts of their papers, see here

https://taxprof.typepad.com/taxprof_blog/2008/01/fleming-present.html

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