No evasion deficit---GILTI at the state-level alone ensures compliance---the perm is piggybacking which decks solvency

Second, there is an efficiency argument for taxing federal tax bases in strategic ways.49 This argument requires a few steps. First, a fundamental tenet of tax economics is that the amount of deadweight loss generated by a tax increases at the square of the tax rate. The jargon is convoluted, but the behavioral intuition is simple. Consider how much trouble you would go to avoid a 5% tax. Now imagine how much more trouble you would go to avoid a 20% tax. You might not do anything to avoid a 5% tax, but you would do a lot to avoid the 20% tax—hence the exponential growth in wasteful tax planning and lost government revenue.50 Note that this first point can be put a different way: all else equal, it is more efficient to raise revenue by broadening the base of a tax relative to raising the rate of a tax. Pulling GILTI back into a state tax base is a more efficient way of raising revenue relative to raising the corporate tax rate. But there is another way that GILTI conformity can be efficient, which brings us to analytic step number two. The second step requires making the observation that different taxes can be evaded in different ways. I can avoid paying income tax by deferring the sale of appreciated assets, but this does not help me avoid paying sales tax on my new car. I used to be able evade the sales tax by purchasing from a remote vendor online, but this never helped with the income tax. The fact that different taxes can be evaded along different margins has the following implications in the federal system as currently in operation: when the states try to collect more revenue by piggybacking on the federal income tax, they are essentially increasing an already high tax rate and spurring additional evasion. By contrast, when states raise revenue with the sales tax then they are raising money using relatively low tax rates that do not cause as much evasion.