“Some of the nation’s largest corporations have amassed vast profits outside the country and are pressing Congress and the Obama administration for a tax break to bring the money home,” David Kocieniewski reports for The New York Times. “Apple has $12 billion waiting offshore, Google has $17 billion and Microsoft, $29 billion.”
“Under the proposal, known as a repatriation holiday, the federal income tax owed on such profits returned to the United States would fall to 5.25 percent for one year, from 35 percent,” Kocieniewski reports. “In the short term, the measure could generate tens of billions in tax revenues as companies transfer money that would otherwise remain abroad, and it could help ease the huge budget deficit.”
“The Obama administration has been uncharacteristically harsh in its criticism of the idea. President Obama and Treasury Secretary Timothy F. Geithner have said they will support it only if it is part of a corporate tax overhaul that results in no decline in federal revenues,” Kocieniewski reports. “US Uncut, a group that protests corporate tax avoidance, has criticized Apple for seeking tax breaks even as it racks up enormous growth and profits. The group has held dance-ins at Apple stores, demonstrated outside a company conference and released a video spoofing an iPod commercial, declaring ‘I love my iPod, but iHate the tax cheat.'”
Kocieniewski reports, “With the economy languishing, unemployment high and Congressional Republicans opposed to additional stimulus, the idea has gained some unlikely allies, including some Democrats, the organization Third Way and the onetime union leader Andy Stern. ‘Even if it costs the government $80 billion in the long haul, it would be worth it to try to put people to work now,’ said Mr. Stern, the former president of the S.E.I.U., who suggests dedicating the tax revenue to an infrastructure bank that would support public works projects. ‘Having it overseas doesn’t help. And we have to do something.'”
Much more in the full article here.