From Reuters, “Obama seeks tax changes for U.S. firms overseas”:
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.
U.S. officials said that in an announcement planned for 11:05 a.m. EDT, Obama will seek to follow through on a campaign promise to change the tax treatment of American firms with overseas operations.
In March, the National Association of Manufacturers and 200 businesses and trade associations signed a letter to Congress opposing provisions in the President’s budget that he appears ready to reaffirm today. Here’s the heart of the letter:
Ninety-five percent of the world’s consumers live outside of the United States. American companies seeking to serve these consumers rely on growth in these markets to restart economic growth and create jobs for Americans. In fact, 22 million Americans work for U.S. multinationals while millions of other Americans are employed by the thousands of small and medium-sized companies that supply and service U.S. multinationals.
American companies require only a level playing field in international tax policy. Unfortunately, the Administration’s proposal to repeal “deferral” would impose a unilateral tax on the foreign earnings of American companies, upsetting the competitive balance between U.S. and foreign companies. This will result in a loss of jobs for Americans and serious negative impacts on the U.S. economy.
The campaign rhetoric about “shipping our jobs overseas?” It’s populist sloganeering that ignores the realities of the global marketplace.
Once again, we’re seeing the political two-step: Praise jobs, but punish the jobs creators.
UPDATE: (9:24 a.m.): The Obama Administration distributed talking points this morning. Here’s the sheet.
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