On Monday, President Barack Obama’s budget will include a proposal to impose new taxes on trillions of dollars in profits accumulated by U.S. companies who do business overseas.
The Obama tax hike would apply a one-time, 14 percent tax on an estimated $2.1 trillion in overseas profit for companies like General Electric, Apple, and Microsoft, reports Reuters. The Obama administration says U.S. businesses would be responsible for paying the tax “right now on the $2 trillion they already have overseas” and estimates its new tax would raise $238 billion, which the administration says would go to its $478 billion infrastructure proposal.
In addition, the Obama tax plan includes a 19 percent tax on the future foreign earnings of U.S. businesses. “At present, those earnings are supposed to be taxed at a 35-percent rate,” notes Reuters, “but many companies avoid that through the loophole that defers taxation on active income that is not brought into the United States, or repatriated.”
Rep. Paul Ryan (R-WI) says Obama’s tax hikes are more of the same.
“What I think the president is trying to do here is to, again, exploit envy economics.”
Obama’s $4 trillion 2016 fiscal budget runs a $474 billion deficit.