US Proposes Taxing Offshore Incomes
February 3, 2015 Taxation in USA
WASHINGTON D.C. – US companies may soon pay a tax on their foreign earnings, with the revenues being earmarked for road construction projects.
On February 1st the White House issued a new statement describing several tax measures which will be proposed in a matter of days in President Obama’s Budget Proposal, with new tax on the incomes and capitals of US companies with offshore operations as a means of paying for infrastructure projects in the country.
In the statement it was proposed that a tax of 19 percent should be imposed on the future foreign earnings of all US companies.
Further, an additional one-time tax of 14 percent should be imposed on the earnings already held offshore by US companies.
The revenues raised from the proposed tax would be used to fulfill shortfalls in the government’s current spending plan on highways and other infrastructure projects.
In its statement, the White House stated that “…this transition tax would mean that companies have to pay U.S. tax right now on the $2 trillion they already have overseas, rather than being able to delay paying any U.S. tax indefinitely.”
The tax will still need to be passed by Congress before being implemented, however, some experts have raised concerns that the measure is unlikely to pass through the Republican-controlled Congress.
Photo By: Tiberiu Ana