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Congress·In Committee·about 1 year ago

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

Also known as: No Tax Breaks for Outsourcing Act

Legislative Progress

✓ Filed
Review
Senate
House
President

Impact Analysis

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

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

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.

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U.S. News & World Report·8 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.

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Source Information

Document Type

Congressional Bill

Official Title

No Tax Breaks for Outsourcing Act

Bill NumberS 409
Congress119th Congress
ChamberSenate
Latest ActionRead twice and referred to the Committee on Finance.

Sponsor

Cosponsors

(19)
D: 19

Analysis generated by AI. While we strive for accuracy, this should not be considered legal or professional advice. Always verify information with official government sources.