Money Minute: Obama Targets Corporate Tax Dodgers

The party may soon be over for companies trying to dodge U.S. taxes through so-called "inversions."

Inversions, where a U.S. company buys a firm in a foreign country and relocates there to avoid paying U.S. corporate taxes, which are among the highest in the world, are becoming the target of the Obama administration. It's a move that has become very popular lately particularly among pharmaceutical companies. But the president wants it to stop.

corporate taxes treasury jack lew
Saul Loeb, AFP/Getty ImagesTreasury Secretary Jacob "Jack" Lew
Treasury Secretary Jack Lew spoke at a conference Wednesday encouraging Congress to enact laws that would ban the practice immediately and retroactive to May. That could jeopardize deals in the works for Medtronic (MDT) and Mylan (MYL).

As part of Lew's discussion on business reform he also said the tax rate for corporations could be lowered to the 20 percent range, which is a big improvement from the current top rate of 35 percent.

BMW is recalling roughly 1.6 million more of its 3-Series cars from model years 2000 to 2006. The issue has to do with air bags in the front passenger seat that when deployed could cause fragments of metal to hit passengers' faces. The air bag inflator is made by Takata, which has been responsible for millions of recalls over the past few years. This week's BMW recall is a much larger one but not the first related to the air bags. Last year it recalled 42,000 3-Series models for the same problem.

In trading Wednesday on Wall Street, the bulls beat the bears with the Dow Jones industrial average (^DJI) gaining 77 points, the Nasdaq composite (^IXIC) up 9 points and the Standard & Poor's 500 index (^GPSC) picking up 3 points.

When flying nowadays, you are constantly nickeled and dimed for things you once didn't have to pay a penny for and the airlines have come to rely on that revenue. Airlines around the world took off with $31.5 billion in fees last year. Adjusted for inflation that is more than 11 times the fee revenue just six years ago. Most of the fees -- 60 percent of them -- come from credit card companies paying airlines for frequent flyer miles it then offers to its customers. Of the money coming out of our pockets, the biggest revenue came from baggage fees followed by fees for things like drinks on board and advanced boarding. Three U.S. airlines topped the list for bringing in the most non-fare revenue: Delta (DAL), United (UAL) and American (AAL).

And finally, home-sharing website Airbnb, which has faced legal challenges in many cities around the world, including New York City and San Francisco, has just rebranded itself to give itself a new identity. While it features an entirely new looking website with video, it is its logo that is creating the most buzz among social media sites. Let's just say it's a little suggestive. The company says it is meant to look like an upside-down heart but does anyone really buy that? One thing's for sure. The campaign has worked so far. For a rebranding, it's getting lots of play.

-Produced by Karina Huber.

8 Retro Ways to Save Money
See Gallery
Money Minute: Obama Targets Corporate Tax Dodgers

Remember what your parents told you to do when you were bored? That's right: Go outside and play. Not only is this an important lesson for kids –- finding ways to have fun using only your imagination –- it's free. It's easy today to get caught in the trap of spending money to entertain our families, whether it's buying an smartphone app, spending money at the mall or the movies or buying new toys. These are fun treats every once in a while, but keep it to a minimum and remind your family of the great outdoors.

Libraries are fighting to stay relevant in today's technology-centric society, so why not help them out while you save money on books and entertainment? Library cards are still free, and your taxes pay for these resources. Borrow books as well as DVDs of movies and television shows and cut back on your digital purchases and on-demand subscriptions.

Before you protest, this is definitely a major lifestyle change if you already use a smartphone regularly, but worth considering if you want to save a lot of money each month. Opting for a phone without Internet access –- or even a pay-as-you-go phone, if you rarely need to use it –- will cut costs; it might offer the added benefit of unplugging from constant connectivity.

Carpooling became popular during a countrywide effort to save gas in the 1970s, and today there are signs of resurgence with technology that allows commuters in the same area to easily find each other. If you don't have the option of public transportation, search in your own community for carpooling groups or talk to your coworkers to figure out a schedule.

Commit to skip the expensive salad bar or lunch spot across the street and pack a bag lunch at least three or four days a week. This can add up to a lot of money saved over time. 

While you don't need to use a pencil and paper to write down every purchase as was done years ago, the routine of tracking everything you buy can be an important habit for more careful spending. If you'd prefer to stay digital with this tactic, use Excel, Google (GOOG) Docs or an online tool that collects your daily transactions and sorts them for you.

This concept is no stranger to those who lived during economically challenging times years ago; if you didn't make enough money, you simply found another job to boost your income. Today, while job availability, familial roles and time commitments differ greatly from back then, you can still look for additional income opportunities. Freelancing is one option for those that need to spend time at home with family; you can also find seasonal opportunities in retail.

Take a tip from earlier generations and make your contributions to savings accounts the same, rather than adding more or less depending on other unexpected expenses. This might mean rethinking the amount you put away each month; even if you lower it, more regularity over time can have a bigger impact.
Read Full Story