1. Why is the main objective of these cross-border mergers, whether the U.S. firm is the acquirer or the company that is acquired, to change the legal domicile of the merged firm from the standpoint of income taxation?
2. Given that in recent years the governments of many nations have been reducing corporate income tax rates in relation to the U.S. rate (which remains one of the world's highest), is the U.S. tax base shrinkage likely to slow down or speed up? Explain.