The one-year tax holiday for repatriating overseas profits sought by U.S. multinational companies would cost taxpayers $78.7 billion over the next decade, according to an estimate from the congressional Joint Committee on Taxation.
Democratic Representative Lloyd Doggett of Texas released the estimate today as Representative Kevin Brady, a Texas Republican, introduced a bill that would allow companies to repatriate profits earned overseas at a 5.25 percent rate, instead of the 35 percent statutory U.S. corporate tax rate.
“This latest ploy by large multinational corporations and their Republican allies to avoid paying their fair share for our national security and economic well-being carries a hefty price tag -- nearly $80 billion,” Doggett said in a statement. “This means we will have to borrow more from foreign creditors or shift a greater burden to American small businesses and working families.”
Companies including Microsoft Corp. (MSFT), Duke Energy Corp. (DUK), Pfizer Inc. (PFE), Google Inc. (GOOG), and Apple Inc. have been lobbying Congress for the tax break, maintaining that it would unlock about $1 trillion in overseas profits that can’t be brought home without prohibitive taxes.
The estimate released by Doggett considers a general repatriation holiday and not the legislation introduced by Brady.
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