Sec. 612. Policy statement on trade
373 words·~2 min read·
/bill/113/hconres/96/rh/section-612A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
The House finds the following: Opening foreign markets to American exports is vital to the United States economy and beneficial to American workers and consumers. The Commerce Department estimates that every $1 billion of United States exports supports more than 5,000 jobs here at home. A modern and competitive international tax system would facilitate global commerce for United States multinational companies and would encourage foreign business investment and job creation in the United States The United States currently has an antiquated system of international taxation whereby United States multinationals operating abroad pay both the foreign-country tax and United States corporate taxes.
They are essentially taxed twice. This puts them at an obvious competitive disadvantage. The ability to defer United States taxes on their foreign operations, which some erroneously refer to as a tax loophole, cushions this disadvantage to a certain extent. Eliminating or restricting this provision (and others like it) would harm United States competitiveness. This budget resolution advocates fundamental tax reform that would lower the United States corporate rate, now the highest in the industrialized world, and switch to a more competitive system of international taxation.
This would make the United States a much more attractive place to invest and station business activity and would chip away at the incentives for United States companies to keep their profits overseas (because the United States corporate rate is so high). The status quo of the current tax code undermines the competitiveness of United States businesses and costs the United States economy investment and jobs. Global trade and commerce is not a zero-sum game. The idea that global expansion tends to hollow out United States operations is incorrect.
Foreign-affiliate activity tends to complement, not substitute for, key parent activities in the United States such as employment, worker compensation, and capital investment. When United States headquartered multinationals invest and expand operations abroad it often leads to more jobs and economic growth at home. American businesses and workers have shown that, on a level playing field, they can excel and surpass the international competition. It is the policy of this resolution to pursue international trade, global commerce, and a modern and competitive United States international tax system in order to promote job creation in the United States.