Camp Territorial Plan Exempts 95% of Offshore Profits From Tax

And people wonder why we dont have jobs....


U.S. House Ways and Means Committee Chairman Dave Camp will release a long-awaited proposal today to shield 95 percent of corporate profits earned offshore from taxation in the U.S.
U.S. multinational companies, including Caterpillar Inc., Procter & Gamble Co. and General Electric Co., have been pressing for such a change to match the tax systems of most other major economies. The exemption would create a territorial system, removing almost all U.S. taxation of offshore profits.
“We’re out of step with the rest of the world,” Camp, a Republican from Michigan, said today in an interview with Bloomberg Television. “We need to move to this territorial system, which allows our companies to not be double-taxed.”
The proposal will be released later today as a draft instead of as a formal bill, according to a Republican familiar with the plan. It’s a slice of the broader rewrite of individual and corporate U.S. tax laws Camp is seeking. Still, the release marks the first time he has made a detailed proposal on an overhaul of international tax law since he took control of the Ways and Means panel in January.
“It seems to be a European-style territorial tax system,” said Rosanne Altshuler, an economics professor at Rutgers University in New Jersey who has written extensively on international tax policy.
With the 95 percent exemption, companies would pay taxes on 5 percent of their profits earned overseas. That would let the U.S. avoid writing detailed rules for disallowing domestic deductions that support untaxed foreign operations.

Continue reading here:http://www.bloomberg.com/news/2011-10-26/camp-territorial-plan-exempts-95-of-offshore-profits-from-tax.html

:mad:

including Senators Boxer and Schumer. The corporations/lobbyists are loading up the super pacs to make sure this legislation passes. The trade-off/bipartianship will be the $67 billion unemployment money included in the so-called jobs bill. One more screwing of american taxpayers in the works.
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All told, 58 organizations and companies listed “repatriation” on their disclosure forms as an issue on which they were lobbying through the first nine months of 2011. While these companies spent at least $71.2 million on lobbying during this period, because of the way lobbying is disclosed, it is impossible to tell exactly how much was spent on what issue.

WIN-affiliated companies such as Pfizer ($7,340,000 overall), Qualcomm ($3,880,000 overall), Microsoft ($3,592,000 overall), Apple ($1,350,000 overall) and Oracle ($1,150,000 overall), among others, spent at least some money to lobby on the issue.

Read more: http://www.politico.com/news/stories/1011/66668.html#ix...

A bill in the House would tax repatriated earnings at 5.25 percent, a fraction of the usual rate of 35 percent; a bill in the Senate would cut the rate to 8.75 percent, or 5.25 percent for companies that added jobs.
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Yet, in the warped politics of Washington, a second tax holiday is a distinct possibility. Senator Charles Schumer, a Democrat of New York, and other Democratic senators have floated the idea that a tax holiday could be used to establish an infrastructure bank. They are focused on the short-run revenue gain from a tax holiday and playing down the substantial revenue loss over time. Mr. Schumer says he would not support a rate as low as 5.25 percent, but even a higher rate would be a big revenue loser. (Schumer supports an 8.75% tax; Senator Barbara Boxer is also one of the Senate Democrats who support this tax giveaway to corporations.)

Similarly, the bipartisan deficit reduction supercommittee, reportedly hamstrung in its quest for trillion-dollar budget cuts, might also try to use the short-run revenue gain from a tax holiday to mask the depth of spending cuts. Or Congressional Republicans may demand passage of a tax holiday in exchange for extending federal unemployment benefits, which expire at the end of the year.

The White House has rightly opposed another “one-time” tax holiday, but politics are pulling in the other direction. Unless President Obama leads the fight, this wrongheaded policy is too likely to become the law of the land. The evidence is there. A corporate tax holiday won’t create more jobs. What it will do is raise the deficit.

http://www.nytimes.com/2011/10/24/opinion/no-tax-holida...