The metamorphosis of US corporate income tax into a value added income tax

The rules of the World Trade Organization (WTO) allow for border tax adjustments in respect of indirect, but not in respect of direct taxes. The system of export rebates of indirect taxes is to the disadvantage of countries, such as the United States, that rely primarily on direct taxes for revenue, rather than on indirect taxes. In this final article in a series of articles on the US tax system, the author describes a proposal to modify the existing US corporate income tax into a tax based on value added with the explicit purpose of making border tax adjustments under such a tax regime WTO compliant in order to create at least a level playing field for US exporting companies.