BUSINESS/JOBS/TAXES/TRUMP AS PRESIDENT: “In Indiana, Missouri and Pennsylvania, President Trump used the same promise to sell the tax bill: It would bring jobs streaming back to struggling cities and towns.
The bill that Mr. Trump signed, however, could actually make it attractive for companies to put more assembly lines on foreign soil.
Under the new law, income made by American companies’ overseas subsidiaries will face United States taxes that are half the rate applied to their domestic income, 10.5 percent compared with the new top corporate rate of 21 percent…
What could be more dangerous for American workers, economists said, is that the bill ends up creating a tax break for manufacturers with foreign operations. Under the new rules, beyond the lower rate, companies will not have to pay United States taxes on the money they earn from plants or equipment located abroad, if those earnings amount to 10 percent or less of the total investment.
The Republican vision for the tax plan was to make the United States a more competitive place to do business. Supporters contend that the new rules do not encourage companies to locate overseas. Rather, they say, slashing the corporate rate will make it more attractive to set up shop at home, since many other advanced economies now have higher taxes.
And manufacturers do not simply follow their accountants’ advice. They consider taxes, but they also look at an array of other factors, including the local talent pool and transportation network, when deciding where to build a new plant.”
-Natalie Kitroeff, “Tax Law May Send Factories and Jobs Abroad, Critics Say,” The New York Times online, Jan. 8, 2018