Business Coalition Reiterates Opposition to Obama's International Tax Plan

As you continue to work on healthcare reform and other legislation this year, the undersigned companies and trade associations want to reiterate our strong opposition to the Administration's proposals that would rescind certain U.S. international corporate tax provisions. We appreciate that the House healthcare reform bill, as it stands today, does not include these provisions and commend the three committees for that decision.

American companies with worldwide operations directly employ 22 million American workers and support an additional 41 million U.S. jobs through their supply chain and through the purchases of goods and services by their employees. A steep corporate tax hike on worldwide American companies, especially during a severe recession, will hinder our ability to protect and create American jobs and will slow our nation's economic recovery.

The current U.S. international tax system has evolved over decades in a manner that attempts to keep worldwide American companies on a nearly level playing field with competitors in other nations. Meanwhile, other leading economies are moving to make their corporate tax systems more competitive. As a result, the United States lags behind and is increasingly isolated from the rest of the world.

The U.S. business community supports closing tax loopholes and prosecuting those who cheat on their taxes. However, the current international tax rules including deferral, check the box and foreign tax credits are fundamental tax provisions, and are integral parts of the US tax system -- not "tax loopholes." It is inaccurate and misleading to represent them as such.

The proposals would force American companies to lose deductions for costs of doing business in the U.S., risk double taxation of dividends from worldwide business operations; and limit their ability to choose the entity or form in which they do business. Together, these proposals are in broad measure equivalent to repealing deferral.

To keep good jobs and decent wages here in America, Congress must ensure that the U.S. tax code keeps worldwide American companies competitive both here at home and abroad. Congress needs to examine tax changes that will enable American companies and U.S. workers to compete in the global marketplace.

We strongly urge Congress to reject any attempt to expand taxation of income beyond the borders of the U.S., as it would impair the competitiveness of American companies and American workers.