United States President
Barack Obama 'say no to Bangalore and yes to Buffalo' as he struggles to bring the ailing American economy back on track. Meeting one of his major election promises, Obama announced end of years of tax incentives to those US companies which create jobs overseas in places like Bangalore.
The incentives would now go to those creating jobs inside the US, in places like the Buffalo city -- bordering Canada in upstate New York.
Obama said "We will stop letting American companies that create jobs overseas take deductions on their expenses when they do not pay any American taxes on their profits, at White House announcing the international tax policy reform. "We will use the savings to give tax cuts to companies that are investing in research and development here at home so that we can jump start job creation, foster innovation, and enhance America's competitiveness".
The new tax laws are expected to majorly hit countries like
India, China and the Philippines, where US companies have been outsourcing their work.
The current taxation system, to which he had been very critical since his election days and as a Senator, Obama said: "It's a tax code that says you should pay lower taxes if you create a job in Bangalore, India, than if you create one in Buffalo, New York."
"The way we make our businesses competitive is not to reward American companies operating overseas with a roughly 2 per cent tax rate on foreign profits; a rate that costs taxpayers tens of billions of dollars a year." "US President Obama said" he wants US companies to remain most competitive in the world. "But the way to make sure that happens is not to reward our companies for moving jobs off our shores or transferring profits to overseas tax havens," he argued.
Announcing a set of proposals to crack down on illegal overseas tax evasion, close loopholes, and make it more profitable for companies to create jobs in the US, Obama said his series of tax reforms would save $210 billion in the next 10 years.
Under new measures, American companies would also have to disclose before the IRS the details of the income American citizens are generating in overseas accounts.
Posted by Rahul Verma | Views 290 | Share Blog
