The Peterson Institute for International Economics is a private, nonprofit, nonpartisan
research institution devoted to the study of international economic policy. More › ›

Keep up to date with Peterson Institute publications, events, and interviews via email, podcast, or RSS. More information on subscription options.

Use filters to narrow your search through our publications and events.

translate

print
cite this

Web Site Citations

MLA Style:

Hufbauer, Gary. C. Policy Brief 10-9: Protection by Stealth: Using the Tax Law to Discriminate Against Foreign Insurance Companies. Peterson Institute for International Economics, 1 May 2010. Web. 1 May 2010. <http://www.iie.com/publications/interstitial.cfm?ResearchID=1554>.

APA Style:

Hufbauer, G. C. (2010). Policy Brief 10-9: Protection by Stealth: Using the Tax Law to Discriminate Against Foreign Insurance Companies. Retrieved May 1, 2010, from Peterson Institute for International Economics, Washington, DC. Web site: http://www.iie.com/publications/interstitial.cfm?ResearchID=1554.

CBE/CSE Style:

Hufbauer G C. 2010 [cited 2010 May 1].Policy Brief 10-9: Protection by Stealth: Using the Tax Law to Discriminate against Foreign Insurance Companies. [Internet]. Washington, DC: Peterson Institute for International Economics. Available from: http://www.iie.com/publications/interstitial.cfm?ResearchID=1554.

Chicago Style:

Bibliography (Notes and Bibliography System):

Hufbauer, Gary C. "Policy Brief 10-9: Protection by Stealth: Using the Tax Law to Discriminate Against Foreign Insurance Companies." Peterson Institute for International Economics. http://www.iie.com/publications/interstitial.cfm?ResearchID=1554 (accessed May 1, 2010).

References List (Author-Date System):

Hufbauer, Gary C. Policy Brief 10-9: Protection by Stealth: Using the Tax Law to Discriminate against Foreign Insurance Companies. Peterson Institute for International Economics. http://www.iie.com/publications/interstitial.cfm?ResearchID=1554 (accessed May 1, 2010).

email page
send comments

Policy Brief 10-9

Protection by Stealth: Using the Tax Law to Discriminate against Foreign Insurance Companies

by Gary Clyde Hufbauer, Peterson Institute for International Economics

April 2010

The severe economic damage done by the global crisis of 2007–09 has reenergized calls to protect domestic products and producers in the United States. One example is a proposal to discriminate against foreign-owned insurance companies, using the tax code. The Neal bill (HR 3424), named after Congressman Richard Neal (D-MA), proposes to tax foreign-owned insurance companies doing business in the United States more heavily than US-owned insurance companies doing exactly the same business in the United States. If this bill or something like it is enacted, cautions Hufbauer, European countries are almost certain to bring a case against the United States in the World Trade Organization (WTO) and seek redress under US income tax treaties. Some European countries might consider tit-for-tat retaliatory legislation that would hurt US-owned insurance companies.

While legal and retaliatory battles are waged, some foreign-owned insurance companies might reconsider their presence in the US insurance market—a role that has greatly benefited the US households and firms that suffered catastrophic losses in the wake of 9/11 and Hurricane Katrina. Equally important, it is a bad idea to deny US nonfinancial companies the benefit of competition between US-owned and foreign-owned firms in an industry that collects hundreds of billions of dollars of premiums annually. Tax abuse in the insurance market, if it exists, can be addressed without discriminating against foreign-owned companies.

View full document [pdf]

RELATED INTERVIEWS

subscribe

Follow us

translate

Policy Brief 10-9

Protection by Stealth: Using the Tax Law to Discriminate against Foreign Insurance Companies