Stopping the Outsourcing of Jobs
When good-paying jobs are shipped to other countries, it hurts communities, families, and our economy. Senator Dorgan is working to stop the outsourcing of U.S. jobs to foreign countries and to create and keep good jobs here at home. He has been the lead proponent of eliminating the tax breaks enjoyed by U.S. companies that move their operations abroad.
Dorgan introduced legislation, S. 260, to shut down a tax loophole that rewards U.S. companies that move U.S. manufacturing jobs overseas.
The legislation would close the loophole that allows U.S. multinational companies to defer paying income taxes on profits they make from the U.S. sale of the products manufactured in foreign factories, until those profits are returned to the United States, if ever. Manufacturers who remain in the United States receive no similar subsidy.
You may not believe it, but when a U.S. company closes down a U.S. manufacturing plant fires its American workers and moves those good-paying jobs to China or other locations abroad, U.S. tax law actually rewards those companies with a large tax break called deferral. The tax code allows these firms to defer paying any U.S. income taxes on the earnings from those new foreign-manufactured products until those profits are returned, if ever, to this country. If a company making the same product decides to stay in this country, it is required to pay immediate U.S. taxes on the profits it earns here.
With the manufacturing sector laying off 791,000 people in 2008 alone, Senator Dorgan believes this legislation should be enacted immediately.
Since 2000, more than four million manufacturing jobs have been lost in the U.S. Dorgan's plan would discourage companies from shipping more American jobs to other countries and it would also save American taxpayers $15 billion in revenue over 10 years.
