White House plans to curb offshore tax avoidance will be rolled out today, the Wall Street Journal reports, with the target on both US multinationals and wealthy individuals who are sheltering an estimated $700 billion in US earnings overseas. The plan takes particular aim at “deferral,” which allows companies to take large tax breaks on profits earned overseas until that money is repatriated to the US.
The administration is trying to raise $210 billion over the next decade in increased tax revenues to curb budget deficits and pay for things like job-creation at home. But the crackdown will draw resistance from big business, as well as some inside Obama’s own party who are averse to raising taxes. The deferral proposal alone could raise $60.1 billion through 2019, while tightening other rules could bring in nearly $140 billion more.