Why States Can Tax the GILTI

91 State Tax Notes, March 18, 2019, p.967

5 Pages Posted: 21 May 2019

See all articles by Darien Shanske

Darien Shanske

University of California, Davis - School of Law

David Gamage

Indiana University Maurer School of Law

Date Written: March 18, 2019

Abstract

A centerpiece of the 2017 federal tax legislation’s reforms to international corporate income tax rules is the new global intangible low-taxed income regime (or GILTI). In a prior essay, we argued that U.S. state governments should conform to GILTI. But might there be constitutional restrictions preventing state governments from doing so? This essay argues that state governments can constitutionally conform to the federal GILTI rules and thereby tax GILTI income as part of the states’ corporate income tax bases. However, in doing so, we explain that state governments will need to be attentive to background constitutional principles.

JEL Classification: K34

Suggested Citation

Shanske, Darien and Gamage, David, Why States Can Tax the GILTI (March 18, 2019). 91 State Tax Notes, March 18, 2019, p.967 . Available at SSRN: https://ssrn.com/abstract=3374991

Darien Shanske

University of California, Davis - School of Law ( email )

400 Mrak Hall Dr
Davis, CA CA 95616-5201

David Gamage (Contact Author)

Indiana University Maurer School of Law ( email )

211 S. Indiana Avenue
Bloomington, IN 47405
United States

HOME PAGE: http://www.law.indiana.edu/about/people/bio.php?name=gamage-david

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