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Recent News & Media
Hoopes Weighs In on Warren’s Real Corporate Profits Tax
April 28, 2021UNC Tax Center Research Director Jeff Hoopes testified at Sen. Elizabeth Warren’s finance subcommittee hearing on Tuesday, April 27. Hoopes called Warren’s proposal for a 7% tax on book income a "Band-aid solution that creates more problems than it solves." More
Coming Up
Federal Tax Policy: International Outlook
Tuesday May 11, 2021In partnership with the AICPA, the UNC Tax Center's expert panel will share highlights from the Senate Finance Committee expected whitepaper on proposed US tax legislation, details from the expected Treasury Green Book on Biden administration revenue proposals, as well as updates and discussion of the latest academic research on income shifting and global tax policy. More
TCJA Effects Tracker
Early Evidence on the Use of Foreign Cash Following the Tax Cuts and Jobs Act of 2017
April 02, 2021The Tax Cuts and Jobs Act of 2017 (TCJA) reduces U.S. multinational companies’ (MNC) internal capital market frictions related to repatriation costs by decreasing costs to access internal capital (i.e., foreign cash). This study examines MNCs’ responses to the TCJA and finds spending and investment behavior are dependent upon liquidity, investment opportunities, and borrowing costs. Domestic capital expenditures increased for MNCs with low domestic liquidity and high domestic investment opportunities. These firms also increased share repurchases. In contrast, MNCs with low domestic liquidity and low domestic investment opportunities increased dividends. MNCs with low domestic investment opportunities and high cost of debt reduced their outstanding debt. We also investigate responses to global intangible low-taxed income (GILTI) incentives and find that MNCs with more foreign cash and a greater likelihood of being affected by the GILTI regime increase their foreign but not domestic capital expenditures - a potential unintended consequence of TCJA. More