Why do we have a health care system based on employer based insurance? Because employer based healthcare is tax deductible, and personal health care is not.
What effect does the home mortgage interest deduction, and home sale capital income tax holiday have on the price of houses -- they result in higher housing prices because they provide incentive for more leverage and reaching for the highest appreciation.
What is the result of the decision for us to tax personal income rather than personal consumption -- more consumption and less saving.
What we tax and how we tax it has a very real impact on behavior around that thing.
The long term effect of large amounts of cash overseas due to having a higher tax rate here is ultimately to build more operations overseas, to use it. That is how the incentive is set up.
Not a fan of a tax holiday, but am a fan of reducing that incentive by bringing our corporate rates lower.