Wednesday, February 5, 2014
Bloomberg: Obama Tax Rhetoric on Offshore Profit Falls Shy of Action, by Richard Rubin & Jesse Drucker:
As President Barack Obama renewed his criticism of tax laws that “reward companies that keep profits abroad,” the government he leads is taking a more subtle approach -- one that’s helping some of those companies.
The U.S. is working with other major economies to curb corporate tax avoidance, an issue that has become a popular political cause in the U.K. and France. The Obama administration wants to prevent U.S. companies from being singled out by European regulators and to ensure that the U.S. doesn’t miss out on any taxes its companies start paying.
Obama’s efforts to win congressional backing for his tax proposals have stalled. That stalemate has turned the attention of companies and countries to the Organization for Economic Cooperation and Development, a government-funded group in Paris seeking to combat what’s known as base erosion and profit shifting, or the movement of income to low-tax jurisdictions.
“We feel like Treasury has been doing a good job in representing U.S. interests,” said Catherine Schultz, vice president for tax policy at the National Foreign Trade Council, whose board of directors includes Google Inc. and Pfizer Inc. “We also feel like they’ve been doing a good job in making sure that the international tax norms are not turned upside down.”
In his sixth year in office, Obama can claim relatively few accomplishments on international taxation -- an issue he used as a populist applause line during his campaigns and as recently as his Jan. 28 State of the Union address.