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Inversion Wave Puts Tax Growth at Risk

The U.S. government expects corporate income tax receipts will nearly double over the next four years as the economy improves. That’s one reason some in Washington are so intent on stopping a potential tidal wave of corporations moving their headquarters abroad to lower-tax countries in what is known as an inversion.

The U.S. expects to rake in $332.7 billion in corporate income tax this year, more than 20% above the $273.5 billion it collected last year. That figure could rise as high as $528 billion by the end of 2017, according to White House projections. But as more companies, such as medical-device maker Medtronic Inc., aim to leave U.S. shores for lower tax havens, that figure could shrink.

Inversions could cost the U.S. government almost $19.5 billion in lost tax revenue over the next decade, according to recent projections from the bipartisan Joint Committee on Taxation.

Read more: The Wall Street Journal

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