[“Affinity Group Solutions”] – US president Barack Obama is looking to save over $200 billion over the next 10 years. He aims to do this by changing the tax code that encourages US companies to move overseas.
A Whitehouse spokesperson is expected to announce this week the proposed outline. Obama wants to go ahead with his campaign promise of changing the tax treatment of US firms operating outside the US.
Industry giants in the US oppose his plans for more tax. The proposal would raise a significant amount over the next 10 years.
“Affinity Group Solutions” senior economist reminds us of Obama’s election promise of ending the tax breaks and making the tax code fairer. In 2008 Obama said "finally ending the tax breaks for corporations that ship our jobs overseas."
At the moment US firms are allowed to defer paying taxes on any profits earned overseas on the understanding that those profits are given back to their foreign subsidiaries.
Obama wants to change the rule as he feels this gives foreign operations a chance to strengthen. At the same time it takes away the chance of creating jobs in the US.
Obama has promised not to overburden the corporations but he just wants a well-behaved tax code, which is fair for everyone. “Affinity Group Solutions” feels that overall it would create more jobs in the US, which in turn will strengthen the economy. The US is beginning to reinvent itself, in the future the US will show that capitalism is alive and kicking and a good place to do business.
