Tax Notes Article by Joann M. Weiner: "It's Time to Adopt Formulary Apportionment"

Tax Notes has published an article by Joann M. Weiner, an adjunct professor at the George Washington University, regarding the need to change the current status-quo of international business taxation. In 1996, the Treasury Department rejected formulary apportionment (FA) because multinational companies didn't maintain the intricately detailed operations they run today. Wiener argues that due to the complex nature of the 21st-century multinational company, FA should be adopted. FA works under the assumption that instead of taxing a companies' foreign income, a company's level of taxation would depend on their business activity abroad. In addition to creating tax-base stability, FA would treat multinationals as a single economic units, making tax enforcement simpler and more effective.