President to Announce Tax, Other Incentives for “Insourcing” Jobs
President Obama announced Jan. 11 that in the next few weeks he plans to propose new tax and other incentives “that reward companies that choose to bring jobs home and invest in America – and eliminate tax breaks for companies that move jobs overseas.” The president made a similar commitment in his State of the Union address two years ago just months after delaying an overseas taxation reform plan due to concerns of potential harm to U.S. businesses struggling with the economic downturn.
A White House fact sheet on the administration’s support for repatriating jobs to, and increasing foreign investment in, the U.S. asserts that “there is a critical role for government policies that support new investments,” including with respect to tax, trade, financing, energy and education. The fact sheet outlines actions taken to date in these areas (e.g., tax breaks for small businesses, launching the National Export Initiative, advancing free trade agreements, expanding access to capital and new investment in infrastructure) as well as additional measures being put forward, such as reforming the corporate tax code, making progress on the Trans-Pacific Partnership agreement and modernizing schools.
A separate White House press release adds that the administration has also announced several other steps to incentivize insourcing, including educating businesses about opportunities to access insourcing loans through the Small Business Administration’s underutilized International Trade Loan program; launching a partnership between the Commerce and State departments to promote investment in 10 pilot countries representing 30% of foreign direct investment in the U.S., expanding to cover 25 countries in 2013 representing roughly 90% of FDI; and increasing support for states’ efforts to promote investment through U.S. Export Assistance Centers in more than 100 cities.