Representatives Brady & Matheson ask: “Should We Leave $1 Trillion Dollars Overseas or Bring It Home?”
by TexasGOPVote on June 16, 2011 at 5:56 PM
Washington, D.C. - Congressmen Kevin Brady and Jim Matheson today released the following statement in response to the Administration’s opposition to lowering tax barriers to encourage American companies with earnings overseas to bring those dollars back to the U.S. for investment.
“In this economy, why the President would turn down an immediate opportunity to bring back $1 trillion in American profits is beyond me,” said Brady. “U.S. profits which are stranded overseas would allow American business to create much needed jobs, invest in infrastructure, and strengthen their companies.”
H.R. 1834: the Freedom to Invest Act of 2011, introduced by Congressman Kevin Brady (R-TX) and Congressman Jim Matheson (D-UT), would temporarily lower a tax barrier to encourage American companies selling their goods and services abroad to bring those earnings back to the U.S. for investment. Presently more than $1 trillion dollars in capital earned by American companies and workers is stranded overseas, due to an out-dated tax structure that penalizes companies for bringing global earnings dollars back home to invest in the United States.
“Putting more private sector capital into the U.S. economy will strengthen recovery efforts and help reduce the federal deficit,” said Matheson. “Let’s do some good now, for American employers and for the U.S. taxpayer, rather than do nothing by maintaining the status quo.”
The last time businesses were allowed to repatriate their overseas earnings in 2004, the S&P rallied 6.5% and gained 15% by the end of the next year. Real GDP grew substantially, from 3.1% in 2004 to 4.3% in 2005, and unemployment dropped from 5.5% in 2004 to 5.0% in 2005, and continuing to drop to 4.5% in 2006.