Today, U.S. Senator Sheldon Whitehouse (D-RI) and U.S. Representative David Cicilline (D-RI) announced the introduction of the Offshoring Prevention Act, a bill that would level the playing field for American manufacturers by eliminating a special tax break for companies that ship jobs overseas. Whitehouse and Cicilline will file the legislation in the Senate and House, respectively, when Congress comes into session later today.
This morning's announcement was made at Tanury Industries, a Rhode Island manufacturing company with service operations exclusively in the United States. Whitehouse was unable to attend in person.
"I have heard from too many Rhode Island small businesses that are fed up with unfair competition from abroad," said Whitehouse, who first introduced the Offshoring Prevention Act in 2011. "By giving special tax deals to companies that ship jobs overseas, we put local small businesses at a disadvantage. Ending this costly tax giveaway will help keep jobs in America and generate nearly $20 billion in new revenue -- a true win-win."
"As we work to get our economy back on the right track, it is critical that we level the playing field so American small business owners can compete successfully in the global marketplace," said Cicilline. "There is no reason that our tax policies should actually reward companies for shipping jobs overseas, and I am looking forward to working with Senator Whitehouse to pass the Offshoring Prevention Act."
"Tanury services over 1000 U.S. based companies with manufacturing jobs right here in the U.S. Tanury Industries is an example of a company that has done it right. We compete on quality, technology and service. We are proud that Senator Whitehouse and Congressman Cicilline have chosen our company, once again, to discuss their very important legislation. Legislation such as this is critical to maintaining our position in the global economy," said Michael Akkaoui, President and CEO of Tanury Industries.
Currently, U.S. companies that manufacture goods abroad for sale here at home are allowed to defer payment of federal income tax -- waiting to pay taxes on foreign income in years that minimize their tax liability. The Offshoring Prevention Act would require companies that send factories and jobs overseas to play by the same rules as ones supporting jobs in the U.S., removing an offshoring incentive and helping local businesses compete.
The Joint Committee on Taxation has estimated that this legislation would generate $19.5 billion in new revenue over ten years.