Letter to the Honorable Senator Orrin Hatch, Chairman of Senate Committee on Finance, the Honorable Senator Ron Wyden, Ranking Member of Senate Committee on Finance - Corporate Tax Reform Should Support American Workers

Letter

Dear Chairman Hatch and Ranking Member Wyden:

I understand there have been many discussion regarding how to move forward on tax reform. I write to share with you some of my views that I hope you will take into consideration as you work on tax reform legislation.

I have attached an op-ed I wrote for the Fresno Bee detailing my views on the border adjusted tax as proposed in the House Republican blueprint and any steps to impose additional tariffs targeted at imports from specific countries. I am worried that these proposals could have a significant negative impact on both consumers and businesses, and I am particularly concerned by the prospect of retaliation from other countries as a result of these potential tax and trade actions.

I am also deeply concerned about the loss of manufacturing jobs and the estimated $2 trillion infrastructure investment gap we face over the next decade. I believe that there is an opportunity for corporate tax reform to address these concerns. Since 1995, California has lost over 400,000 manufacturing jobs, and as the manufacturing industry evolves with new technology, I firmly believe we must look out for manufacturing workers and help them fill the jobs currently needed to support U.S. production. Any congressional action on corporate tax reform should ensure that workers are also taken care of and not lost in the shuffle.

As you know, there is over $2.5 trillion in corporate profits held offshore. I am aware that the Joint Committee on Taxation in 2014 projected that a repatriation tax holiday similar to the one that took place in 2004 would have cost over $95 billion. I am also concerned by findings from the Permanent Subcommittee on Investigations' 2011 report on Repatriating Offshore Funds that "the top repatriating corporations reduced their overall U.S. workforce by 20,931 jobs."

These findings are deeply concerning and reinforce my belief that any tax reduction for repatriated profits as part of transitioning to a new corporate tax system must be mandatory and produce revenue. The resulting revenue should be directed toward direct spending programs to support manufacturing and infrastructure in a way that prioritizes American workers. I would also suggest examining how corporate tax reform could connect any reduced repatriation tax rate to the direct creation of U.S. jobs.

Thank you for the work you do for the Senate Finance Committee and for your consideration of the priorities I have laid out in this letter. I hope we are all united in ensuring that any tax code changes lead to additional support for workers in America.

Sincerely,

Dianne Feinstein
United States Senator

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