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EU cash grab is a huge boost to Trump's tax-reform effort

  • In the same day, the EU is demanding that Amazon pay Luxembourg $300 million in back taxes and that Ireland grab $15.3 billion in taxes from Apple.
  • This daily double tax whammy is inadvertently making a great argument for Trump's call for 20 percent corporate tax rates here in the U.S.
  • It's time for the Trump team and the congressional GOP to use today's news as a rallying call for their plan.

The Trump administration plan to sharply cut corporate tax rates here in the U.S. just got a major shot in the arm from a surprising source: The European Union.

Okay, so maybe the tax-hungry bureaucrats in Brussels aren't such a surprising bunch to inadvertently make the Trump tax plan look good. But boy, European Commission President Jean-Claude Juncker and his pals sure have some of the best timing the White House and Republicans could have hoped for.

That's because the European Commission came up with a daily double tax grab against U.S. companies for Wednesday. First, it ordered Amazon to fork over $294 million to Luxembourg for what it deems to be illegal tax benefits. But that's chump change, because then the EU announced it will be taking the government of Ireland to court to force it to collect $15.3 billion in taxes it says it should have collected from Apple.

And how was your Wednesday morning?

"The message of the day's news for Amazon, Apple, and just about every other major U.S. corporation is now crystal clear: The days of being able to take advantage of highly favorable corporate rates in Europe are ending, and the exact expiration date could come anytime."

All of this comes just as the debate heats up over the Trump team's plan to cut U.S. corporate tax rates to 20 percent and offer them a 10 percent special repatriation rate for overseas parked cash for a limited time.

The message of the day's news for Amazon, Apple, and just about every other major U.S. corporation is now crystal clear: The days of being able to take advantage of highly favorable corporate rates in Europe are ending, and the exact expiration date could come anytime. They can continue to roll those dice overseas, or get behind the GOP effort to provide them with a reliably low tax rate right here in the good ol' USA.

This comes less than 24 hours after billionaire investor Warren Buffett and Blackrock CEO Larry Fink both spoke out against the Trump plan to cut permanent corporate tax rates to 20 percent.Buffett and Fink cast doubt over how much America's higher rates hurt American corporate competitiveness, but who said "competitiveness" was the key issue here? It's about companies keeping more of their profits to reinvest or even just to pay out to shareholders. And the EU just gave us 15.6 billion answers to Buffett and Fink's competitiveness argument.

If the folks in the White House and the GOP congressional leadership are smart, they'll not only point out this daily double tax whammy from the EU but they'll also quietly start to work with top CEOs to make sure they're learning today's tax lesson very well. Many corporate leaders may be reluctant to work openly in partnership with President Trump, but they can still push for these cuts while standing with a congressional leader or simply speak for themselves.

A significantly lowered corporate tax rate will give the Amazons and the Apples of the world new confidence and certainty in their ability to hold on to domestic profits. Not only that, it will also encourage big companies to rethink parking billions overseas in the first place.

The EU has just accidentally handed the Trump tax reform effort a major gift, and for American corporations and investors it could be a gift that keeps on giving.

Commentary by Jake Novak, CNBC.com senior columnist. Follow him on Twitter @jakejakeny.

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