Michael Stumo

Michael Stumo is the chief executive officer of the Coalition for a Prosperous America.

Recent Articles

The Progressive Tax Reform You’ve Never Heard Of

How ending profit shifting can fix corporate tax cheating and satisfy Republicans 

(Photo: AP/Susan Walsh)
This article appears in the Fall 2016 issue of The American Prospect magazine. Subscribe here. Imagine we started a coffee business, Really Great Coffee USA, Inc., ten years ago. We had venture-capital backing to build our global coffee supply chain. We established prime retail locations across America and other countries, creating a world-beating brand that signifies quality, taste, and happiness. Really Great Coffee, Inc. (RGC USA), has gone public. We as founders are now very wealthy because of our innovative and profitable business model—also because our tax and legal advisers had wonderful solutions to avoid U.S. corporate taxes. The U.S. statutory rate is 35 percent of taxable income, but because of various shelters it is effectively just over 27 percent. But even that 27 percent rate only applies to earnings booked as U.S. income. So the true rate can be far lower. Early on, RGC USA set up subsidiaries in tax havens—countries with low populations and absurdly low...