Congress·In Committee·S. 409

Senate Bill Targets Corporate Outsourcing by Ending Tax Breaks for Overseas Profits

No Tax Breaks for Outsourcing Act

about 1 year ago·View on Congress.gov

Part of: U.S. Lawmakers Move to End Tax Discounts on Corporate Overseas Profits

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Stalled

No legislative action in over 90 days.

↔Companion bill: Congress Proposes New Rules to Eliminate Tax Breaks for U.S. Companies Moving Operations Abroad

Legislative Progress

Senate

House

President

Law

Key Points

This bill changes how the government taxes large companies that do business in other countries. Currently, some companies pay a lower tax rate on money they make abroad than they do on money made in America. This plan would end those discounts and require companies to pay the same rate regardless of where the profit is earned.
The policy targets large international corporations, especially those that move their headquarters to foreign countries or shift their profits to 'tax havens' to avoid paying U.S. taxes. It aims to stop companies from moving factories and offices to other countries just to save money on their tax bill.
A major change would require companies to calculate their taxes for every country where they do business. Right now, companies can use high taxes paid in one country to hide profits made in a country with no taxes. This bill would make them pay the full U.S. tax rate on profits made in every single country.
The bill also cracks down on 'corporate inversions.' This happens when a U.S. company buys a smaller foreign business and claims its headquarters is now in that foreign country to avoid taxes, even if the company's leaders and main operations are still based in the United States.
If passed, these rules would generally start applying to the tax year beginning in 2025. The goal is to encourage companies to keep jobs and investments in America by making it more expensive to move them overseas for tax reasons.

TaxesEconomy FinanceLabor Employment

Impact Analysis

Personal Impact

Who is affectedScoreImpactCertaintyScopeDurationSentiment

Scores: 1 = low, 5 = highSentiment: -5 to +5 (net benefit)

Milestones

2 milestones2 actions

Feb 5, 2025Senate

Read twice and referred to the Committee on Finance.

Feb 5, 2025

Introduced in Senate

Related News

2 articles

Thomson Reuters·5 months ago

Outsourcing Bill Catches Tax Community's Attention

The tax community is analyzing several competing anti-outsourcing measures, including the No Tax Breaks for Outsourcing Act. The bill would require multinationals to pay the same tax rate on profits earned abroad as in the U.S. and calculate taxes on a country-by-country basis.

U.S. News & World Report·9 months ago

Whitehouse Spotlights Provision in Trump Bill that Will Ship American Jobs Overseas

Senator Sheldon Whitehouse argues that current tax laws under 'GILTI' provide a half-off discount for corporations moving profits offshore. He advocates for the No Tax Breaks for Outsourcing Act to ensure multinationals pay the same rate on foreign profits as domestic businesses.