Statement by the Press Secretary
In order to support American businesses and the workers who have driven our economic recovery, the President has repeatedly called on Congress to reform our business tax system – to close wasteful loopholes, lower our corporate tax rate and simplify the tax code for everyone. But he’s also been clear that where Congress has failed to act, the Administration will do everything within its authority to ensure that the system works for hard-working Americans and our economy.
That’s why the President is pleased that the Department of Treasury is acting again to discourage companies from taking advantage of a tax loophole known as a corporate inversion – moving their tax residence overseas on paper to avoid paying their fair share in taxes here at home. When multinational corporations exploit these loopholes – enjoying the many benefits of locating in the United States without responsibly paying into the system – it erodes the American tax base, undercuts businesses that play by the rules and ultimately leaves the middle class and small businesses to pay the tab. Business decisions should be driven by genuine business strategies and economic efficiencies, not accounting gimmicks that game our broken tax system.
Today’s actions build on the steps Treasury has already taken to reduce the tax benefits of – and when possible, stop – corporate inversions, which have helped reduce the pace of these transactions. But only Congress can stop inversions outright, which is why the President has proposed to fully close the loophole that allows for corporate inversions in each of his last three Budgets. Congress should follow the Administration’s lead by supporting workers and businesses that play by the rules rather than protecting corporations that ship jobs and profits overseas.