CONFERENCE REPORT ON H.R. 4520, AMERICAN JOBS CREATION ACT OF 2004 -- (House of Representatives - October 07, 2004)
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Mr. KIND. Mr. Speaker, the retaliatory tariffs that the European Union has issued over our delay in complying with World Trade Organizations are hurting manufacturers all over this country, and it is past time to address this issue. Legislators on both sides of the aisle and in both the House and Senate agree on this basic premise, and it is a shame that a bill to solve this problem has been burdened with unnecessary tax incentives to corporations. I, along with many other members of Congress from both sides of the aisle have been pushing for congressional action to fix the international trade dispute over the extraterritorial income (ETI) and Foreign Sales Corporation (FSC) programs. We have a bipartisan, fully paid-for remedy that would reform these tax provisions, put the United States tax code in compliance with the World Trade Organization (WTO), and reduce the tax burden on American manufacturers and farmers. Unfortunately, the Majority leadership ignored this bipartisan approach in favor of a budget-busting, controversial bill that does little for small manufacturers in Wisconsin and includes multiple provisions completely unrelated to the trade problem we need to fix immediately.
Because of the House majority's previous inaction on reforming the FSC-ETI trade dispute, the European Union (EU) continues to ratchet up tariffs on nearly 100 categories of U.S.-produced exports. This costs American businesses and workers by making our products less competitive in the major European market. Unless we reform the FSC-ETI tax provisions, EU tariffs on American products will continue to climb, potentially costing American exporters over $4 billion.
With over two million American manufacturing jobs lost since 2001, it is critical that we act to reverse this trend by eliminating incentives for American jobs to be sent overseas and working to end trade barriers that hurt American exports. Anticipating the EU tariffs, Congressmen CRANE, RANGEL, MANZULLO and LEVIN introduced bipartisan legislation last year to address the FSC-ETI trade dispute. H.R. 1769, the Jobs Protection Act, would have eliminated the American tax breaks found in violation of WTO rules, and reinvested the savings back into American manufacturers by reducing their tax rates. I, along with 175 other members of Congress, cosponsored this legislation and have pushed for the House to consider this legislation.
Despite this bipartisan compromise, the conference agreement brought to the Floor today a fiscally irresponsible bill that is filled with special interest breaks and will increase already record budget deficits. H.R. 4520 provides over $42 billion in tax incentives for large multinational corporations while providing little to no tax relief to small and medium-sized manufacturers, farmers, and unincorporated businesses. The Republican chairman of the House Small Business Committee has expressed his opposition to this legislation because it fails to include smaller non-Chapter S corporations in its manufacturing benefit.
Furthermore, the House shamefully misses an opportunity to meaningfully reform the regulation of tobacco in this country. While I support the buyout for tobacco farmers, which will help hardworking farmers in Wisconsin, I am disappointed that the bill does not include a Senate provision giving the Food and Drug Administration authority to regulate tobacco. This hard-won provision was supported by major tobacco manufacturers as well as health advocacy groups, and the conference committee, by eliminating it, has allowed an historic opportunity to improve the health of this country pass by.
Mr. Speaker, with 2.7 million American manufacturing jobs lost over the past years, including over 80,000 in my home state of Wisconsin, we should not be playing partisan games on the House floor. We should be considering legislation that will end European tariffs on American exports, helps domestic farmers and manufacturers be more competitive, closes abused corporate tax loopholes, and does not burden our children with huge amounts of debt that they will have to pay off in the future. I urge my colleagues to oppose H.R. 4520 in its current form so that Congress can move forward on responsible ETI-FSC legislation.