Skip to comments.Obama seeks tax changes for U.S. firms overseas (No more deducting overseas operations expenses)
Posted on 05/04/2009 5:24:34 AM PDT by SeekAndFind
WASHINGTON (Reuters) - President Barack Obama on Monday will propose changing provisions in the tax code that he says encourage U.S. companies to move jobs overseas, as part of a broader package aimed at saving $210 billion over 10 years.
Obama will seek to follow through on a campaign promise to change the tax treatment of American firms with overseas operations.
That portion of his plan -- opposed by such firms as Pfizer Inc and Oracle Corp -- would raise more than $100 billion in revenue over the next decade.
Obama vowed in a February address to the U.S. Congress to make the tax code more fair by "finally ending the tax breaks for corporations that ship our jobs overseas."
Currently, U.S. firms are allowed to defer paying taxes on profits earned overseas if they plow those profits back into their foreign subsidiaries.
Critics say those rules encourage businesses to bolster their foreign operations instead of creating jobs at home.
But an array of firms signed onto a letter to congressional leaders in March opposing changes to the so-called deferral provision, saying they would make U.S. businesses less competitive.
The letter was signed by 200 companies and trade associations, including Pfizer, Oracle, Microsoft Corp Johnson & Johnson and General Electric Co as well as the Business Roundtable and the U.S. Chamber of Commerce.
The letter said the firms would not be on a level playing field with international rivals, many of which are not required to pay taxes at home on overseas entities.
Senior U.S. officials who described Obama's plans said they were balanced and would not put excessive burdens on firms.
NO MORE DEDUCTING EXPENSES
A central provision would prohibit companies from deducting expenses supporting their overseas operations until they pay taxes on offshore profits.
(Excerpt) Read more at uk.reuters.com ...
How would this affect B.O.’s sugar daddy Soros?
You watch how many US corporations relocate their headquarters to the Cayman Islands to avoid this one.
So how much of this baloney is needed before Obama becomes persona non grata even among big moneyed Democrats?
I am worried about American innovators and employers not Soros who is hedged for this. This is a disaster for US based MNC’c.....so they will become Dubai or China based....wait and watch the Gov slit their/our wrists and bleed the survivors dry through some other ill advised scheme to raise money for dinner in Chicago.
Yep... they just cease being US corporations. Way to go, Obummer.
Yes — they would have been financially much better off with McCain.
What will this do to the stock market?
Many of the big money Democrats are trust funders and this law may have little impact on their wealth and income.
It is a damn tax increase on US companies and the socialists call it a SAVING. They cannot stop lying, can they?
Oh Yeah...this will work. New regulations that will push the companies to move EVERYTHING to the most tax advantaged regions that can support their operations. I’d bet they’ll take the jobs with them...ya think?
Good job, 0bama. You charlatan gasbag.
It’s time to take back the country.
As if Obama cared
Well, I expect the lobbying on Congress to be faster and more furious than ever before. Congress may fold.
Obama doesn’t seem to understand that the multinationals owe alliegence to no country. If the rules get too onerous, they will just move their headquarters elsewhere.
Corporations don’t pay taxes. People do.
The stock market is up because companies are becoming leaner and more profitable.
Yep. The dems should have seen this coming. It looks like some of the pharmaceutica companies are on this list. So - obama’s idea is to drive up health costs even more, apparently.
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