Washington, DC – In case you missed it, U.S. Senator Sheldon Whitehouse (D-RI), a senior member of the Senate Finance Committee, published an op-ed on Friday in U.S. News & World Report highlighting a tax provision in the Republican reconciliation package that incentivizes multinational corporations to offshore American jobs and profits. Whitehouse also spoke out against the provision on the Senate floor last night.
“President Donald Trump loves to say that he puts ‘America First.’ But the truth is that Trump’s policies put America Last, undermining our economy by fueling high prices, choking off growth and sending American jobs overseas,” wrote Whitehouse.
“Massive tax breaks for big corporations who offshore jobs started with Trump’s first tax cuts package in 2017. Under the painfully appropriate acronym ‘GILTI,’ if a multinational corporation funnels its profits offshore, it now gets a half-off discount on its taxes. You can build a factory in Asia or Europe and pay no tax on a portion of foreign profits by using subsidiaries in tax havens like the Cayman Islands and Bermuda,” continued Whitehouse. “In other words, Trump’s corporate tax breaks hurt regular Americans while filling the coffers of multinational corporations.”
The Trump tax law created a special tax rate for offshore profits that is half the domestic rate. Since the 2017 law’s passage, studies have found that multinationals have increased foreign rather than domestic investment. The Republican One Big Beautiful-for Billionaires Bill would award over $200 billion in tax breaks to multinational corporations that ship jobs and profits overseas.
“To put ‘America First,’ my colleagues in the Senate must vote to end Trump’s tax benefits for those who outsource American jobs,” concluded Whitehouse.
In February, Whitehouse and Rep. Lloyd Doggett (D-TX) reintroduced the No Tax Breaks for Outsourcing Act to repeal the 2017 Trump tax law’s offshoring incentives and ensure multinationals pay the same rate on foreign profits that domestic businesses pay on profits earned at home. The legislation would boost U.S. economic competitiveness by encouraging domestic investment, leveling the playing field for domestic companies, and bringing the U.S. into compliance with the global minimum tax agreement.
Read the full piece in U.S. News & World Report.
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Trump and Senate Republicans Are Sending American Jobs Overseas
The Republican budget bill gives tax breaks to corporations that move factories and jobs offshore
By Senator Sheldon Whitehouse
President Donald Trump loves to say that he puts “America First.” But the truth is that Trump’s policies put America Last, undermining our economy by fueling high prices, choking off growth and sending American jobs overseas.
Federal Reserve Chair Jerome Powell testified before Congress this week that the president’s sweeping tariffs will likely push up inflation in the months ahead. Trump’s chaotic, indiscriminate tariffs are scaring off companies from investing in America, just as they create a nightmare for small businesses. U.S. and foreign businesses can’t plan long-term investments when tariffs change from day to day, seemingly at the president’s whim.
Worst of all, the so-called “Big Beautiful” budget bill currently contains more than $200 billion worth of tax breaks over 10 years for offshoring American jobs, according to official estimates from the nonpartisan congressional Joint Committee on Taxation.
In truth, this budget bill is beautiful only for billionaires. It proposes ending health coverage for 16 million Americans, hiking energy bills and cutting off food assistance for children. At the same time, it funds costly incentives for U.S. companies to ship jobs and build factories overseas – exactly the opposite of what Trump promised on the campaign trail.
Tragicomically titled “Make Rural America and Main Street Grow Again” in the House version, this little-noticed tax scam hidden in the Republican bill will hit hardworking Americans who have already seen factories close and Main Street businesses boarded up because of bad trade policy coming out of Washington.
Massive tax breaks for big corporations who offshore jobs started with Trump’s first tax cuts package in 2017. Under the painfully appropriate acronym “GILTI,” if a multinational corporation funnels its profits offshore, it now gets a half-off discount on its taxes. You can build a factory in Asia or Europe and pay no tax on a portion of foreign profits by using subsidiaries in tax havens like the Cayman Islands and Bermuda.
In other words, Trump’s corporate tax breaks hurt regular Americans while filling the coffers of multinational corporations.
The tax break in Trump’s 2017 law for “Foreign-Derived Intangible Income” means that the fewer physical assets such as factories and equipment that a company locates in America, the bigger the tax break. That hardly puts “America First.”
The Joint Committee on Taxation found that after Trump’s 2017 corporate tax cuts went into effect, the average tax rate paid by U.S. multinational corporations fell by half, to 7.8%.
By 2020, U.S. multinational corporations were using 15 tax havens to report nearly 60% of their foreign-derived profits. Using Bermuda as a tax haven, U.S. corporations reported nearly $40 billion in profits there that year – a figure that is more than five times the size of Bermuda’s economy.
Predictably, after Trump’s 2017 tax breaks went into effect, multinationals increased their investments overseas, rather than creating jobs at home. With its educated, English-speaking workforce and low tax rates, Ireland is a favorite offshoring destination for U.S. tech and pharma companies. Trump has complained about the U.S. trade deficit with Ireland, but it was his own 2017 tax law that created the problem by incentivizing companies to offshore jobs there.
According to a 2022 Senate Finance Committee investigation, U.S. pharma giant AbbVie made more than 75% of its sales to U.S. patients in 2020, but reported all but 1% of its income offshore. It managed to do this by creating a subsidiary in Bermuda that “owns” corporate intellectual property rights, and subsidiaries in Singapore and the Netherlands that contract with third parties in Germany and Italy. Main Street can’t compete with such tax trickery.
Trump’s tax favors for multinationals that send jobs overseas were scheduled to diminish this year. But my Republican colleagues in Congress are rushing to extend and even expand benefits for companies who send American jobs overseas.
Many of the provisions in the beautiful-for-billionaires bill last only four years. But not those for the multinational elites; Republicans made offshore tax breaks permanent. And they don’t come cheap: the House bill would give $165 billion in tax breaks to multinational corporations, according to the Joint Committee on Taxation. The Senate bill goes even further, giving more than $200 billion in tax breaks to multinationals.
Republicans are accelerating a damaging trend. The share of U.S. tax revenue paid by U.S. corporations has plummeted from a third of all government revenue in the 1950s to less than 10% today. Corporate America has increasingly evaded paying its fair share toward infrastructure, national defense and education. Yet these are the very public goods that have made America the best place in the world to do business.
The billions of dollars in tax revenue we will lose if we extend these breaks to rich corporations would be enough to fund five years of tax credits for health insurance premiums that Republicans are seeking to cut; to make community college free; and to fund the entire federal budget for medical research – with money left to spare.
Want to stop outsourcing American jobs? An easy place to start is to require U.S. multinationals pay the same rate on foreign profits that businesses pay on profits earned at home.
To put “America First,” my colleagues in the Senate must vote to end Trump’s tax benefits for those who outsource American jobs.
