BILL CLINTON: Executives Think The US Tax Code Is 'Crazy'

bill clinton cnbc

CNBC Bill Clinton at the Clinton Global Initiative. Bill Clinton is calling on the US to follow other countries around the world and lower its corporate tax rate to reduce so-called corporate "inversions" — the controversial practice of relocating a company headquarters overseas to take advantage of lower rates. When executives now look at other countries' tax codes, they think the US system is "crazy," Clinton said.

At the Clinton Global Initiative annual meeting Tuesday morning, a moderator asked the former president whether companies that had already embraced inversions were "unpatriotic." President Barack Obama announced new measures designed to curb corporate inversions on Monday.

Clinton did not address companies that have used inversions to get lower rates and instead spoke broadly about the need to reform the system and lower corporate taxes.

"Whether it is or not, companies ... have a short-term perspective. A lot of these companies feel duty-bound to pay the lowest taxes they can pay. America has to face the fact that we have not reformed our corporate tax laws," Clinton said.

Clinton acknowledged he signed and supported a bill increasing corporate tax rates in his own administration. However, he argued the rate relative to other countries had since changed.

"So a lot of these executives — even if they want to bring the money home — think, 'This is crazy. I can borrow the money in America ... and better that I borrow the money at 2% than repatriate it at 20%, or 10%, or 5%, or 6%, or whatever it is.' We need to reform the tax system," Clinton said. "We're bailing water out of a leaky boat. And the only two things you can plug the leaks in that boat: Either we undertake corporate tax reform, or every other country in the world says, 'We are wrong and we’ll go back to the way we used to do it.'"

The ex-president's wife, Hillary Clinton, is a front-runner for the Democratic presidential nomination in 2016. However, Clinton laughed and dismissed the question when he was pressed on whether he might "know anyone" who could bring Democrats and Republicans together on the tax reform issue in 2016.

"That may be — I have been assaulted by cleverness on all fronts for quite a long while now. That may be the cleverest in I have ever heard," he said.

View Clinton's remarks below.

More From Business Insider

• LeBron James Didn't Eat Sugar, Carbs, Or Dairy For 67 Straight Days, Lost 'A Ton Of Weight'
  

• Here's How The Obama Administration Is Acting Alone To Stop Inversions
  

• Here's How Much You Need To Make To Be In The Top 1% In Your State