Good afternoon, and thank you for joining us today for the next in our series of hearings on comprehensive tax reform. Today’s hearing will examine international tax rules in various countries and identify best practices that might be applied here in the United States. The hearing will explore policy choices that must be considered to create a structure that maximizes competitiveness and job creation while also appropriately protecting the U.S. tax base.
This is the second hearing the committee has convened on international tax. During the first hearing, we looked at how America’s high statutory corporate tax rate, the ever-increasing complexity of the tax code, and our worldwide system of taxation impairs our competitiveness in the global economy.
During that hearing a number of witnesses encouraged the committee to benchmark our efforts on international tax reform against what other countries, especially our major trading partners, have done recently in this area.
Many of our major trading partners across the globe have already reformed their tax laws in ways they believe help their companies expand their own global operations and support good-paying jobs within their own borders. Some of these countries have improved upon the rules they’ve had in place for decades, while others have recently enacted major reforms with global competitiveness in mind.
Through the testimony of the panel assembled here today, we will discuss the approaches developed and implemented by our global competitors. We hope to learn what influences led other countries to move toward a territorial system and other related corporate tax reforms, such as a lower corporate tax rate.
We also expect to hear some details about the process these countries undertook in developing their reforms, as well as lessons learned and other outstanding issues these countries are encountering with their international tax systems.
Finally, in hopes of crafting a system that is uniquely American, we will begin to focus on what a more territorial U.S. tax system would look like, including key design options to consider for the U.S.
There is no doubt that the global marketplace is changing. Today, it doesn’t even slightly resemble the marketplace that America once dominated. As the world economy changes, America must also change and adapt. That begins with transforming our tax code – so that America can be a more vibrant competitor abroad and a more attractive place to invest and create the jobs we need here at home.
As this committee re-examines the tax code and pursues comprehensive tax reform, we are grateful for the insight provided by our witnesses. Thank you for being here. I will now yield to Ranking Member Levin for his opening statement.