Congress should address tax evation issue
Inversion is the federal/international version of Pennsylvania's idiotic Delaware loophole, under which the state government stands by while companies evade taxes on the billions of dollars they make on their operations in the commonwealth.
Under inversion, corporations evade U.S. taxes on billions of dollars that they make in the United States, their biggest market, by acquiring an overseas company and pretending to move their headquarters to that company's home country.
The historically do-nothing Congress has remained true to form by doing nothing as more companies line up to evade their tax bills. It has not addressed tax reform or measures specifically to thwart inversion.
Last week Treasury Secretary Jacob Lew initially said he would not act without congressional action but then changed course. The department announced that it was examining ways to thwart inversions by regulation.
So it should. Congress indeed should address the tax issues that corporations blame for their interest in inversions. But the Treasury should make sure that there are substantial penalties when companies seek to profit in the American market while shirking U.S. taxes.