Rep. John Delaney (D-Md.) introduced a new plan Friday (December 12, 2014) to pay for highway improvements through fresh revenues from offshore income.
Under the measure, offshore corporate income would be taxed at 8.75 percent, allowing multinationals to bring cash back to the U.S. far cheaper than at the top corporate rate of 35 percent. Currently, companies pay that full rate on income throughout the world, but can defer paying taxes until the income is brought to the U.S.
Delaney’s measure would also give Congress an 18-month deadline for tax reform, and include a fallback plan for how to overhaul the international tax system. That plan would end deferral and lower the rates on offshore income, which the Maryland Democrat said would encourage more companies to bring their foreign earnings back home.
“The rising threat of corporate inversions, the looming insolvency of the Highway Trust Fund, and the daily problems caused by inadequate infrastructure all mean that we shouldn’t delay,” Delaney said in a statement. “It’s time for a new solution.”
At best, Delaney’s bill could lay a marker for debate next year, given that the House has already left Washington for the last time in 2014.
Arizona, Arkansas, Colorado, Kansas, Louisiana, New Mexico, Oklahoma, Texas