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Firms Fight Overseas Tax Changes Worth Billions

Last year's sheltered earnings could have brought US $20B

By Matt Cantor,  Newser Staff

Posted Apr 22, 2009 11:10 AM CDT
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(Newser) – Overseas tax reform plans in the works under President Obama would put a serious squeeze on top firms, which under current law can store foreign income abroad indefinitely, reports the Wall Street Journal. Ten of the biggest companies earned $58 billion in 2008 that’s now sheltered overseas—money that could bring $20 billion in tax revenue.

The administration is hoping a change in the law could pull in some $210 billion between 2011 and 2019, and Obama’s 2011 budget calls for “reform.” But 200 firms have written to Congress opposing the move. “This one hits the bottom line of companies more than any other issue right now,” said a tech lobbyist. "We have to defeat it."

Jeffrey Kindler, chairman and CEO of Pfizer, speaks at a news conference Jan. 26, 2009 in New York. Overseas sheltering cut Pfizer's effective tax rate by some 20% last year, the Journal says.
Jeffrey Kindler, chairman and CEO of Pfizer, speaks at a news conference Jan. 26, 2009 in New York. Overseas sheltering cut Pfizer's effective tax rate by some 20% last year, the Journal says.   (AP Photo/Mark Lennihan)
Treasury Secretary Timothy Geithner pauses as he addresses a breakfast meeting of the Economic Club of Washington, Wednesday, April 22, 2009, in Washington.
Treasury Secretary Timothy Geithner pauses as he addresses a breakfast meeting of the Economic Club of Washington, Wednesday, April 22, 2009, in Washington.   (AP Photo/Pablo Martinez Monsivais)
President Barack Obama makes remarks on housing refinancing, Thursday, April 9, 2009, in the Roosevelt Room of the White House. At left is Treasury Secretary Timothy Geithner.
President Barack Obama makes remarks on housing refinancing, Thursday, April 9, 2009, in the Roosevelt Room of the White House. At left is Treasury Secretary Timothy Geithner.   (AP Photo/Gerald Herbert)
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COMMENTS
Showing 3 of 4 comments
woodyTX
Apr 23, 2009 2:16 AM CDT
LM it appears to me you don't have a clue who exactly is destroying the middle class. Question............. should the US gov't continue to tax its citizens on their personal worldwide income as it does .........or will the country be evacuated as people flee to lower tax countries as your theory posits ? If so why haven't you fled to Japan LM ? It might be a good idea for you to act on your bullshit. Sounds good to me.
professortech
Apr 22, 2009 8:30 AM CDT
Dear LibertyMan - Like most conservative "business can do no harm" drones you take one aspect of leveling the economic field for business and turn it into an alarmists draconian nightmare of doom and gloom for American business while at the same time making loose cannon commentary about all those you perceive as liberals. I haven't heard such claptrap since Agnew's "nabobs of negativism" statement or Rush Limpbrains latest utterance. To help set you straight - go to this link http://www.doingbusiness.org/e... - Where it shows that your two vaunted champions of business (Japan and france) rank far behind the US in 9 out of 11 catagories evaluating the ease of doing business. The only areas that they individually rank ahead of the US is "Dealing with construction permits" and "Ease in closing a business" . I don't think with corporations mishandling Billions and declaring the greatest profits in history that you are going to get much sympathy by crying poor me.
woodyTX
Apr 22, 2009 4:55 AM CDT
Amen Doc.

A look at the future of taxes under Obama
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taxes • Treasury Department • tax haven • Obama administration • President Obama • tax shelter

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