Demands Change in U.S. Tax Laws
Congressman Ron Paul, MD
Americans already have grave concerns about the loss of sovereignty
inherent in our participation in global government organizations
like the UN and the WTO. Few understand, however, the extent to
which Congress already capitulates to the globalists when it writes
the laws that affect all of us.
week, the WTO appellate panel ruled that U.S. tax rules exempting
some corporate income earned overseas from taxation constitute an
"illegal subsidy." Incredible as it seems to liberty-minded
Americans, the WTO and the Europeans are now telling us our laws
are illegal and must be changed. It's hard to imagine a more blatant
example of a loss of U.S. sovereignty. Yet there is no outcry or
indignation in Congress at this naked demand that we change our
laws to satisfy the rest of the world. I've yet to see one national
politician or media outlet even suggest the obvious, namely that
our domestic laws are simply none of the world's business.
sad irony is that Congress already changed our corporate tax rules
last year in an attempt to appease the Europeans, who had filed
a complaint with the WTO about our treatment of corporate overseas
earnings. The Europeans accuse us of "subsidizing" U.S. companies
by not taxing every last penny of their foreign income. Yet virtually
all European countries have what is known as a "territorial" tax
system, meaning they do not tax their citizens and companies on
income earned outside the country at all. By contrast, America has
a "worldwide" tax system, which imposes tax on income earned anywhere.
Even so, the WTO continues to accuse of us maintaining an unfair
practice, setting the stage for Europe to seek billions of dollars
solution to the WTO complaint is obvious- we should stop taxing
foreign income altogether. Surely the Europeans could not object
if we changed our system to more closely resemble theirs. After
all, the IRS should not be taxing activity outside the U.S. anyway-
it's outrageous that American citizens are actually less free than
the socialist Europeans when it comes to income earned abroad. Prominent
members of the Republican congressional leadership have stated they
would prefer a territorial tax system, and I intend to hold them
to it by introducing legislation that will end the taxation of foreign
latest affront to our sovereignty makes it clear we must get out
of the WTO if we hope to avoid further international meddling in
our domestic affairs. The WTO is not about free trade, but rather
government-managed trade that benefits certain corporate interests.
The Constitution grants Congress, and Congress alone, the authority
to regulate trade and craft tax laws. Congress cannot cede even
a small part of that authority to the WTO or any other international
body, nor can the President legally sign any treaty which purports
to do so. The Founders never intended for our nation to become entangled
in international trade agreements, and they certainly never intended
to have our laws overridden by international bureaucrats. Congress
may not object to being pushed around by the WTO, but the majority
of Americans do.
Ron Paul is a Republican member of Congress from Texas.
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