Obama reveals plan to close corporate tax loopholes
US officials draw up plans to eradicate means for companies shifting income offshore
US president Barack Obama and treasury secretary Timothy Geithner has
released details of a plan aimed at closing corporate tax loopholes.
In 2004 – most recent year for which data is available, US. multinationals
paid about $16bn of tax on approximately $700 bn of foreign earnings, according
83 out of the 100 largest US companies have operations in low tax
jurisdictions, according to a Government Accountability Office report.
‘It’s a tax code that says you should pay lower taxes if you create a job in
Bangalore, India, than if you create one in Buffalo, NY,’ said Obama.
The reforms are estimated to raise $210bn over the next 10 years, $103.1bn of
which by removing tax advantages for creating jobs and investing in business
expansion overseas, including the reforming of tax deferral rules.