America’s corporate income tax should not encourage corporations to shift jobs or profits abroad. A “territorial” tax system would be an even greater failure. A “pure worldwide” tax system would be much more successful in meeting the goal of raising tax revenue.
Currently, American corporations have an incentive to move jobs offshore or shift profits offshore because they are not taxed on offshore profits unless those profits are returned to the United States (repatriated). This is a built in tax deferral system. To get the corporations to bring the money home they are sometimes offered large decreases to the amount of tax they have to pay. Corporations wait for these “tax holidays” to bring money home.
Enacting a pure worldwide tax system means that deferral of taxes would be repealed