The most promised move by American President Barack Obama in his election campaign is about to be implemented. President Obama promised to create job oppurtunities for American citizen within 2 years. Seeing American economy growth as top priority, he quoted of implementing tax to the companies that provide outsourcing to countries like India,china,etc.,
Obama announced that it is an end for the tax incentives for the companies that provide job overseas instead of creating a job vacancy in America.So far the companies who wished to implement a project in America should have to pay much tax, and so many american companies started to outsource their project for other countries like India. The tax policy favoured them,to say, the outsourcing companies were asked to pay less tax.Keeping up to his promise, Barack Obama reconsidering the tax poilicy will now award the tax incentives for the companies that create job oppurtunity in America itself.
“We will stop letting American companies that create jobs overseas take deductions on their expenses when they do not pay any American taxes on their profits,” Obama said at White House announcing the international tax policy reform.
“We will use the savings to give tax cuts to companies that are investing in research and development here at home so that we can jump start job creation, foster innovation, and enhance America’s competitiveness,” Obama said.If this is implemented, the most hard hit country will be india who depends on America for development in IT field. Obama quoted that,its a tax code that says you should pay lower taxes if you create a job in Bangalore,India, than if you create one in Buffalo, New York.”
US President said: “The way we make our businesses competitive is not to reward American companies operating overseas with a roughly two per cent tax rate on foreign profits; a rate that costs taxpayers tens of billions of dollars a year.”
Obama still wants the American companies to be the top competitive throught out the world,but it should help american citizens by creating vacancies and not oversea countries. Obamas reckons that over 210 billion dollar will be saved in next ten years by his series of tax reforms.