Obama's Push To Levy Taxes On Overseas Profits Alarms Tech Giants
Professor Joseph A. Bankman is quoted in the San Jose Mercury News in a story about changing U.S. tax laws to require American companies to pay taxes on foreign earnings:
Currently, many big companies avoid paying U.S. taxes on revenue from foreign subsidiaries by reinvesting the money overseas, either by parking cash in various accounts or by plowing it back into foreign operations.
While the administration has not discussed any specifics, President Barack Obama's preliminary budget documents state that he plans to raise $210 billion over the next 10 years through better enforcement and reform of tax policies governing U.S. business activities overseas, including deferral.
That's a relatively small amount compared with total overseas profits, according to Stanford University professor Joseph Bankman, an expert on business and tax law. He said the figure suggests Obama will more likely push for incremental adjustments rather than an outright elimination of the policy.