If you were CFO of Huntsman, your overseas cash just became cheaper and thus more accessible. What would you do with it? How would you decide?
What is the deferred tax consequence, if any, if firms are required under the new tax law to capitalize R&D, but still expense R&D on the income statement? What are the potential valuation effects (stock price effects), if any?
How would you make the adjustment to earnings (and maybe cash flows) to compare “apples to apples”, for the effect of the new tax law, which transitions to a territorial system, but not before imposing a one-time tax on overseas accumulated profits? What, if any, are value implications for these firms?
Is repatriating cash to the US that is overseas “bad”? From whose perspective? Why do you think the author used the term “specter” in describing repatriation?
The new tax law reduces rates for corporations from 35% to 21%, yet many firms, especially banks, will be recording sizable losses in their 2017 4th quarters. Why?
Apple, Microsoft, Google, et al. have cumulatively billions of unrepatriated foreign earnings/cash. If you were a policy maker, what would be the optimal rate of tax on those earnings to encourage repatriation? How would you decide on that rate?
If you were CFO of Intel, what would you do? What are all your options and how would you try to make a decision about your $10 billion in overseas cash?
If the switch to a territorial tax system from the current worldwide system goes through, would firms that have deemed foreign earnings as indefinitely reinvested need to accrue a tax liability on those nonrepatriated earnings? If so, what would be the effect on the financials and the effective tax rate (ETR)?
If you were a policy maker, would you consider lowering corporate income tax rates in the U.S.? If so, by how much? Would you consider eliminating the corporate tax altogether and just tax individuals? Why or why not?
Does it make sense using the Apple tax story to change the tax code in the U.S. to a territorial system and to reduce the tax rate? What are the benefits? The costs? What do you suggest be done?
What are some of the implications (accounting implications, implications on corporate behavior, etc.) if corporate penalties (fines, settlements) were all deemed to be permanently non-deductible? Do you agree with the proposed legislations? Why or why not?
Facebook had an accounting change that resulted in a $900 million boost to earnings. The FASB now requires “excess tax benefits” from stock options to flow through the income statement, rather than APIC. Does the change improve financial reporting? How?
Do you think that policy innovation and related execution is greater at a national level compared to that from a global structure? Do you think Ireland will develop its own independent tax policy, apart from the EU? Is this a positive development? Why or why not?
Apple has been ordered to pay additional tax by the EU on profits in Ireland. Do you agree with the EU ruling? How could you determine if Apple has accrued a liability for potential future taxes on these foreign earnings?
Tim Cook at Apple says Apple will not repatriate overseas profits until the U.S. rate is “fair.” How could you see whether Apple accrued or did not accrue a liability for U.S. taxes on foreign earnings?
$2.4 trillion (TRILLION) of “indefinitely reinvested” profits of U.S. multinationals are overseas. Why? Is this a problem? If so, for whom? If so, what solutions would you propose? What is the effect on the effective tax rate of indefinitely reinvested profits?
Why do you think the FASB issued a new standard to do away with all current classifications of deferred taxes?
If you were CEO of a U.S. firm, would you still try to do a tax inversion? What obstacles would you have to overcome? Or, would you spend more on lobbying to try to get the tax laws changed?
