US President Barack Obama has vowed to eliminate tax benefits for American companies shipping jobs to foreign countries but did not reveal its blueprint in his maiden budget speech.
In a slew of measures aimed at boosting the nation’s economy, the government would do away with tax breaks for firms outsourcing jobs to overseas destinations including India. At the same time, the administration would be providing tax relief to 95 per cent of American working families.
“The budget also begins to restore a basic sense of fairness to the tax code, eliminating incentives for companies that ship jobs overseas and giving a generous package of tax cuts to 95 per cent of working families,” Obama said in his speech on Thursday.
Nearly 1,000 US firms, which have shipped their jobs overseas are anticipated to be affected with the proposed elimination of tax incentives. The plan mainly refers to one of the provisions in the tax code that allows companies to pay lesser taxes for profits earned from foreign shores.
However, the US is yet to outline the ways to abolish tax breaks for the entities outsourcing jobs.