Washington, DC – Today Senator Sheldon Whitehouse (D-RI) and Congressman David Cicilline (D-RI) introduced a bill to keep jobs in America. Their Offshoring Prevention Act would eliminate a tax break for companies that send jobs overseas, level the playing field for U.S. manufacturers, and reduce the budget deficit by billions of dollars.
“Companies shouldn’t receive a tax benefit for sending jobs overseas and putting Rhode Island manufacturers at a disadvantage,” said Whitehouse, who first introduced the Offshoring Prevention Act in 2011. “Ending this tax giveaway will help keep jobs in America and reduce the federal budget deficit in the process.”
“When they’re given the chance to compete on a level playing field, Rhode Island workers will do their jobs better than any competitors. It’s long past time to close tax loopholes that reward companies for shipping American jobs overseas,” said Cicilline, who serves in the House Democratic Leadership as Co-Chair of the Democratic Policy and Communications Committee. “Let’s pass this bill into law and give Rhode Island workers a chance to get ahead.”
Under current law, an American company that moves its manufacturing jobs and operations overseas can delay paying its U.S. taxes indefinitely—a benefit not available to companies that remain in the United States. Giving corporations the advantage of being able to claim income in years with offsetting losses or deductions, this tax “deferral” amounts to a major tax subsidy to businesses that offshore jobs and assets.
Whitehouse and Cicilline’s Offshoring Prevention Act would prohibit companies from deferring income tax on profits earned from the manufacture of goods abroad for sale in the United States.
By ending this taxpayer subsidy for sending American jobs overseas, the bill would discourage companies from moving jobs abroad and encourage companies that have already offshored jobs to bring them home.
According to the Bureau of Labor Statistics, U.S. manufacturing jobs have declined by 28% since the turn of the century – from 17.2 million jobs in 2000 to 12.3 million in 2016.
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