Durbin, Brown, Warren, Baldwin, Sanders: Tax Credits Should Go To Companies That Invest In American Workers, Not Ship Jobs Overseas
[WASHINGTON, DC] – Today, U.S. Senators Dick Durbin (D-IL), Sherrod Brown (D-OH), Jack Reed (D-RI), Elizabeth Warren (D-MA), Tammy Baldwin (D-WI), and Bernie Sanders (D-VT) introduced the Patriot Employer Tax Credit Act, a bill that would provide a tax credit to companies that provide fair wages and good benefits to workers while closing a tax loophole that incentivizes corporations to send jobs overseas. The loophole costs the U.S. Treasury approximately $50 billion each year at a time when outsourced jobs and stagnant wages force more American families to turn to safety net programs to make ends meet.
“Today, I introduced the Patriot Employer Tax Credit Act, which will reward businesses that exemplify American values and treat workers fairly – not companies who ship jobs overseas. We should be rewarding companies that invest in their workers by providing fair wages, health insurance and retirement benefits,” Durbin said. “I would like to thank Senators Brown, Reed, Warren, Baldwin and Sanders for their support on this bill. In a time of tight budgets, we should reserve tax credits for the companies that do the most to help workers and our economy here at home.”
“We must reward American companies that invest in American workers. Instead of giving tax breaks for companies that ship jobs overseas, we should give tax incentives to companies that do right by their workers. That means incentives for keeping jobs in the U.S., providing fair wages and benefits, and maintaining diverse workforces that utilize American service members and veterans,” said Senator Brown.
“We need to bring American jobs back home, crack down on offshore tax havens, and eliminate tax advantages for companies that ship job overseas. Passing this bill would be a smart step toward these goals. We need to level the playing field for companies that want to invest in American jobs and ingenuity,” said Senator Reed.
“Big corporations have rigged the tax code so badly that they’re actually rewarded when they move American jobs overseas,” said Senator Warren. “We should stitch up those loopholes and invest in those companies that invest in America – not those companies that invest in the most lobbyists.”
“We should invest in hard-working American businesses and workers instead of rewarding corporations that ship our jobs to other countries.” said Senator Baldwin. “It’s time to close tax loopholes that encourage the outsourcing of American jobs. We need to reward hard work here at home and create economic growth that will rebuild our middle class.”
“It’s time to stop giving tax breaks to companies that have shipped millions of American jobs overseas, and start investing in small- and medium-sized businesses that are increasing decent-paying jobs in America. This bill begins to do just that and I thank Sen. Durbin for his leadership on this important issue,” Sen. Bernie Sanders said.
The Patriot Employer Tax Credit Act would grant a tax credit equivalent to 10 percent of the first $15,000 of wages earned by each employee—worth about $1,200 per qualifying worker depending on the company’s federal effective tax rate—to companies that meet the following criteria:
- Invest in American Jobs: Maintain headquarters in the U.S. if the company has ever been headquartered in America, has not inverted to avoid U.S. taxes, maintain or increase the number of workers in the U.S. compared to the number of workers overseas, and does not decrease the number of workers through the use of contractors.
- Pay Fair Wages: Pay at least 90% of U.S. workers an hourly wage equal to 150% of poverty for a family of three (about $14/hour or $30,000/year).
- Provide Quality Health Insurance: Offer Affordable Care Act-compliant health insurance to employees.
- Prepare Workers for Retirement: Provide 90% of non-highly compensated U.S. employees a defined benefit plan OR a defined contribution plan with an employer contribution or match equal to at least 5% of worker compensation.
- Support Our Troops and Veterans: Pay the difference between regular salary and military compensation for all National Guard and Reserve employees called for active duty and have a plan in place to recruit veterans.
- Create a Diverse Workforce: Have a plan in place to recruit employees with disabilities.
Companies with fewer than 50 employees, who face different business circumstances than larger corporations, can qualify for the tax credit by fulfilling a subset of these criteria.
To offset the cost of the Patriot Employer Tax Credit, the legislation would close a loophole that allows corporations to deduct interest expenses used to invest overseas—such as the interest costs of building a manufacturing plant overseas or shipping materials abroad—while allowing the company to defer paying taxes on income derived from those investments until it is repatriated.
Previous Article Next Article