Icahn Pledges $150M To Reform Tax Code on Overseas Earnings, End Inversions

The current state of USA politics is utterly dysfunctional, says Icahn, and a corporate tax structure which encourages companies to keep money out of America is part of the problem.

“While I plan to raise third-party funds, I believe my own commitment of $150 million to the PAC will be more than enough to make voters fully aware of the terrible consequences that will ensue if Congress fails to pass legislation immediately to stop these ‘inversions, ‘” Mr. Icahn wrote in the letter.

The billionaire said inversions cost Americans a half trillion dollars in market value, hundreds of millions in tax dollars, and tens of thousands of jobs. Specifically, tax repatriation holidays, where corporations pay little to no taxes on overseas cash for a brief period, have been shown to benefit investors more than workers by freeing up money for stock buybacks instead of jobs. In a follow-up tweet, he shared the letter he sent to the House Ways and Means Committee, the Senate Finance Committee, and House and Senate minority and majority leaders.

Mr. Icahn plans to put $150-M into a new super-PAC that would push for legislation to discourage so-called tax “inversions”, in which U.S. companies renounce their legal citizenship to lower their tax bills. These are when a company shifts its headquarters to outside the United States in order to position itself for lower tax rates.

Icahn has a net worth of about $22 billion, according to the Bloomberg Billionaires Index, built over decades of buying stakes in companies and pushing for changes to improve their performance.

But if his proposed reforms to corporate taxes are successfully pushed through, there stands a good chance that Apple could bring back billions in otherwise lost revenue into the U.S economy, and other companies will follow suit.

Carl Icahn’s tax repatriation super PAC might just help him get everything he’s always wanted out of Apple (AAPL – Get Report). Also last month, he released a 15-minute video warning the country that economic peril if not disaster was once again on the horizon and that an “activist” was needed in Washington.

Mr. Icahn, who describes himself politically as a centrist, has made small donations to Republicans in recent years. “Basically he’s by far the best of what I see out there”, Mr. Icahn told The Wall Street Journal.

Trump has said repeatedly that he wants “his friend” Icahn to be his Treasury Secretary if he’s elected president.