Structuring Inversions Is A Billion Dollar Business For Wall Street

Wall Street banks have been advising their corporate clients on ways to avoid taxes for a long time.  Inversions are the latest method.  US corporations purchase a foreign company in a low tax state and reincorporate in that state.  This reduces US tax revenues substantially.  The share of US tax revenues from corporations has dropped considerably over the last 40 years.  That means that the tax burden is shifted to Americans who are unable to employ the tax avoidance tactics used by corporations and the super-rich.  This is just another business for the Wall Street banks.  Some bankers don't like doing inversions but they claim that a competitor will do it if they refuse.  That is the excuse that many bankers used when they competed in the mortgage backed security business.  Corporations justify tax avoidance by arguing that they are necessary in a competitive global market.  They claim that US corporate tax rates make them uncompetitive.  Its hard to believe that claim when corporate profits are at an all time high.  Moreover, the corporate tax code is riddled with loopholes that reduce the effective corporate tax rate substantially.