July 11, 2018

The Hill: The GOP Tax Bill Rewards Offshoring – Here’s What We Can Do to Stop It

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The new law allows companies to pay half or less of the corporate tax rate on profits earned abroad as they would here at home, while also exempting from tax entirely a 10 percent return on tangible investments – such as plants and equipment – that are made overseas. As experts from the Tax Policy Center and the Institute on Taxation and Economic Policy (ITEP) assessed, this creates additional incentives and rewards for profits to be made overseas – in other words, accelerating the offshoring of jobs and operations. The Congressional Budget Office (CBO) agreed, noting that several provisions “may increase corporations’ incentive to locate tangible assets abroad.” Ultimately, many multinational corporations will pay little to nothing in U.S. taxes on their profits earned by shifting call centers and factories overseas. Read more