Wednesday, February 15, 2012

Adminstration's Budget includes Tax Increases on Firms That Move Jobs, Profits Overseas

The Obama administration called for higher taxes Feb. 13 on corporations that shift jobs and profits overseas, while offering help to companies that keep business in the United States, in the it's fiscal year 2013 budget.

The administration called for U.S. taxes on excessive profits from the offshore use of transferred intangibles.

The plan also called for a credit against income tax equal to 20 percent of the expenses paid or incurred in connection with “insourcing” a U.S. trade or business. Deductions for expenses paid or incurred in connection with “outsourcing” a U.S. trade or business would be disallowed.

Also in the Green Book, the administration proposed disallowing the deduction for domestic production activities for oil and other fossil fuel production.

In a fact sheet, the administration said that in addition to stopping transfer pricing abuses, the budget would delay the deduction for the interest expense attributable to overseas investment.

1 comment:

  1. Obama: Minimum Tax on Multinational Firms Needed to Improve Fairness

    Posted February 17, 2012, 7:55 P.M. ET

    EVERETT, Wash.—There needs to be a “basic minimum tax” for multinational corporations to ensure fairness for American manufacturers, President Obama said Feb. 17 during a campaign-style speech at Boeing's 787 Dreamliner manufacturing plant.

    Multinational companies should get no tax advantage over companies “investing here and hiring American workers,” Obama said to hundreds of cheering workers. “Every penny of that minimum tax should go towards lowering the taxes for companies like Boeing that choose to stay and hire here in the United States of America.”

    Obama said American manufacturers should get “a bigger tax cut,” but he did not offer new details. And he said that high-tech manufacturers should get “double the tax deductions” for making products in the U.S.A.