Senate bill would end key offshore tax breaks for US multinationals
In committeeS. 409Latest action
Sponsor: Sheldon Whitehouse · Senator · RI
AIDecoded by AI · checked against the recordRead the official text
Official title: No Tax Breaks for Outsourcing Act
119th Congress
Topics: Jobs & the economy
Introduced:
Read the official bill on Congress.govIn plain words
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Senate bill S 409 would close offshore tax loopholes for large US multinationals, targeting foreign subsidiaries, inversions, and debt-shifting.
45-second read · 4 questions answered below
What does this do?
S 409 would require US companies to pay taxes on foreign subsidiary profits annually on a country-by-country basis rather than using a blended global rate. It removes a reduced tax rate on certain foreign earnings and eliminates a deduction that lets companies load US operations with debt to shift profits abroad. It also tightens rules on corporate inversions and would treat foreign companies managed from within the US as American companies for tax purposes.
Who does it affect?
The bill primarily affects large multinational corporations with significant overseas operations or foreign subsidiaries. Foreign companies that do substantial business in the US but are managed from American soil would also be affected.
Why does it matter?
Applying taxes country by country would prevent companies from using blended global rates to obscure low-tax arrangements. Tightening inversion rules and the management-location test would limit companies from reducing their US tax bill through corporate structure changes.
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Read the official bill on Congress.govMake the call
Where does it stand?
- IntroducedFeb 5, 2025
- Senate committeeYou are here · Feb 5, 2025
- Senate vote
- House
- The president's desk
Right now: a Senate committee is reviewing it. If the House changes it, it goes back to the Senate before reaching the president.
Latest action: — Read twice and referred to the Committee on Finance.