WASHINGTON, D.C. — Senate lawmakers introduced legislation Thursday that would make it harder for multinational corporations to game the offshore provisions in the newly adopted tax overhaul. Sponsored by Sen. Amy Klobuchar (D-MN), the Removing Incentives for Outsourcing Act (S.3674) would ensure that tax rates for profits booked offshore are applied on a per-country basis, rather than on a worldwide average basis — reducing the chance of gaming. The legislation would also reduce the incentive to outsource jobs by eliminating the 10 percent tax break companies receive for moving real operations and assets offshore. The bill follows an approach similar to the Per-Country Minimum Act (H.R. 6015), introduced by Rep. Peter DeFazio (D-OR) in the House of Representatives.
The Removing Incentives for Outsourcing Act is cosponsored by Senators Tammy Duckworth (D-IL) and Chris Van Hollen (D-MD).
The measure was welcomed by the Financial Accountability and Corporate Transparency (FACT) Coalition, a non-partisan alliance of more than 100 state, national, and international organizations working toward a fair tax system that addresses the challenges of a global economy and promoting policies to combat the harmful impacts of corrupt financial practices.
Clark Gascoigne, the deputy director of the FACT Coalition, issued the following statement:
“The recent tax overhaul was so riddled with loopholes that even the measures in the bill purporting to curb the gaming have loopholes themselves. With this legislation, Senators Klobuchar, Duckworth, and Van Hollen take direct aim at one of the biggest problems in the 2017 tax law.
“The Removing Incentives for Outsourcing Act would make it harder for multinational corporations to artificially reduce their tax liabilities by shifting profits to tax havens like Ireland and Switzerland. Requiring that tax rates apply to multinationals’ offshore profits on a per country basis is a necessary piece of any effort to end the incentive for offshore tax games.
“The legislation would also reduce the outrageous incentive in the Tax Cuts and Jobs Act that actually gives companies a larger tax break the more they move real operations and jobs offshore.”
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Journalist Contact:
Clark Gascoigne
Deputy Director, The FACT Coalition
+1 202 810-1334
cgascoigne@thefactcoalition.org
Notes to Editors:
- Click here to read the press release from Sen. Klobuchar.
- Click here to read the full text of S.3674.
- Click here to read a summary of S.3674.