Dems propose tax incentives to encourage companies to bring jobs

May 9, 2012 Issues: Economy

Democrats in the House and Senate on Tuesday proposed legislation that would encourage companies to move jobs and operations back to the United States through a new tax incentive, and also discourage them from moving jobs overseas by eliminating related tax deductions.

The Bring Jobs Home Act was introduced by Rep. Bill Pascrell (D-N.J.) in the House and Debbie Stabenow (D-Mich.) in the Senate. Both of these sponsors said President Obama supports the bill, which they said would help foster job creation in the United States.

"Passing the Bring Jobs Home Act will stop our tax code from providing corporate welfare by closing the loopholes that encourage outsourcing, and give incentives to businesses to reverse the flow of jobs back home," Pascrell said.

"We need to be exporting our products, not our jobs," Stabenow said. "Instead of letting companies use tax loopholes that help them ship jobs overseas, we need to be cutting taxes for companies that create jobs in America. It's time to stop rewarding companies that send jobs to other countries and instead support businesses creating jobs here at home."

Their bill, H.R. 5542 in the House and S. 2884 in the Senate, would let companies qualify for a tax credit equal to 20 percent of the costs associated with moving jobs and operations back to the United States. It would also eliminate current rules that let companies deduct the costs of moving jobs and operations out of the United States.

The House bill is co-sponsored by 14 Democrats, including House Ways and Means Committee ranking member Sandy Levin (D-Mich.). The Senate bill is co-sponsored by Sens. Sherrod Brown (D-Ohio) and Sheldon Whitehouse (D-R.I.).