Fact Check: Does McCain want tax breaks for companies that send jobs overseas?
[cnn-photo-caption image= http://i2.cdn.turner.com/cnn/2008/images/10/10/art.mccain02.ap.jpg caption="Is McCain really in favor of tax breaks for outsourcing companies?"]The Statement
At a campaign event Thursday, October 9, in Cincinnati, Ohio, Democratic presidential nominee Barack Obama repeated a long-time charge: "John McCain says he wants to keep giving tax breaks to companies that ship jobs overseas."
Get the facts!
The Facts
All U.S. corporations are required to pay a 35 percent tax on income, including that earned outside the United States, but numerous loopholes complicate corporate tax laws. U.S. companies are allowed to defer paying taxes on income as long as that money is being used by the company overseas and remains "unrepatriated income." Tax experts say that can amount to a lengthy or even indefinite deferral, as long as the corporation continues its overseas operations. Deferring tax payment on income earned with non-U.S. operations does offer an incentive for U.S. companies to do business abroad.
The Obama campaign cites as the basis for its claim three Senate votes by Republican nominee Sen. John McCain going back to 1995, with the most recent one being in 2005, against repealing tax subsidies or tax deferrals for U.S. companies with overseas operations.
The Obama campaign also says McCain's economic proposals don't include proposals for changes to current law that allow U.S. companies to defer paying taxes on off-shore income.
The McCain campaign says that McCain has not made statements advocating tax breaks for overseas companies, and the campaign points to McCain's proposed reduction in the tax rate for all U.S. corporations from 35 percent to 25 percent as an incentive that would encourage multinational companies to invest more in U.S. operations and jobs. A CNN search of McCain campaign statements also found nothing advocating tax breaks for corporations operating overseas.
CNN asked a McCain campaign spokesman to explain McCain's position on tax deferred corporate income. The spokesman said the issue was being researched, but by deadline on Friday, October 10, there was no response. The campaign did supply CNN with material arguing that the loss of U.S. jobs to overseas operations cannot be linked directly to the tax rules for U.S. companies operating abroad.
Robertson Williams, principal research associate for the Washington, D.C.-based non-partisan Tax Policy Center, said the issue of taxes and domestic companies moving operations and jobs overseas is complex.
"There is the real movement of production units - you close a factory in North Carolina and start producing textiles in China with Chinese workers, and the people in North Carolina lose their jobs. Then there is the strictly financial one - a company moves its headquarters to the Cayman Islands but leaves its jobs here. Either way, there are tax implications for any company (with operations abroad) but they're not necessarily related to sending jobs overseas," Williams said.
"The point is that McCain has not come out in favor of cracking down on companies doing business overseas," Williams said. "It's one of those amorphous things - if you don't favor undoing something, does that mean you're in favor of doing it?"
The Verdict
Misleading. While McCain is on record voting as recently as three years ago
against eliminating or changing tax deferrals for U.S. companies with overseas
operations, he has not said he "wants to keep giving tax breaks" to companies
sending jobs overseas, as Obama stated. Obama's statement also oversimplifies
the complexities of taxes for U.S. companies operating abroad, and U.S. jobs
moving overseas.
I real wish mr Mccain can stop playing a negative campains me as he's surporter I am considering to vote for obama who seems to have a straits talk about the tough time that we are facing right now!
I think McCain don't want any tax breaks for anyone, except the republicans. I am sick to my stomach about the hate that his party has about a black man running for president. I think it is a dirty low down trick to have 3 black men to get on TV and say how much they support McCain, I think it just shows how some people can't believe that a black man can be the president. I think the republicans, alot of them are racist and need to wake up! They would rather see this country fall apart over skin color. Some of those that work on Fox News, and a few on other news stations are so jealous, GET over it! Many people are not racist anymore. This is the best Election I have ever seen in my life and it really shows how racist and how much hate there really is today in the United States of America. Its an outrage and I will not vote for a racist president.
The candidates should stick to the political issues at hand, because the true fact is that our country has not dealt with the racial issues that still plague our society today. Therefore to some this presidential debate is about race and not who is the best man for the job. May God bless all of us.
This guy is an idiot!!!!!!!!!!!
WOW.... I WOULD HAVE NEVER GUESSED THAT...UNLESS I WAS LIVING UNDER A "ROCK"
He wants corporate tax breaks! If that means US corporations move overseas to be competitive, then he could care less!
Yes, he'll give tax breaks to US corporations that move jobs overseas!
Don't believe his twisted truth! He's suffering from Alz...!
not so misleading-
McCain's legacy is corporate tax breaks.
Senator John McCain and GOv Sarah Palin are planting the seeds of racial hatred to cover their own short comng and some Republican whites and blacks are too blind to see it..
What I have recently seen at McCain rallies worries me. If McCain and Palin think that the rhetoric that embraced McCain's campagne after Palin was choosen, the language that fires up these crowds is helping the American cause they are sadly mistaken. The level of anger and hatred and violent hate speech displayed at these rallies reminds me of an earlier darker time in our nations history. A time I pray to God we don't revisite. It actually turns off the many of us who are still making up our minds. And as everyone says we are the ones who will choose the next president. It is neither constructive to our national interest of getting this country out of this economic disaster or resolving the two wars we are currently embroiled in. It doesn't promote engagement and co-operation, it further fuels bi-partisanship. I believed McCain early on when he spoke of reaching across the isle and working together to heal and cure the problems that plague our country. Was that all just rhetoric? It distracts us from the very real problems we face as a society. Promoting fear and feeding hatred diminishes us all. We are Americans! We are better than this or are we?
I believe we are heading back into isolationism when it comes to import/exporting, global aid and military intrusions, which will affect the global economy and create a battle of economics for trading dollars.
In the end, as those of us with grandparents who went through the great depression of the 1930s have seen with them, the U.S. and other countries will start to ignore third world needs for our own survival.
Whomever becomes our next president, the weight of the world is upon their shoulders and they will have a huge amount of work to accomplish.
he wants to ,regardless if he said it or not. he just like bush.
Outsourcing jobs are one of the reason why our economy is hurting. You don't take good paying jobs from Americans and expect that they will have the same disposable income to drive our economy by their purchasing ability.
McCain & Palin is incouraging their supporters to attact Obama, even one of them said kill him, the other saying that he would not vote for a black man, well let me tell you McCain & Palin supporters Obama Mother was a lovely White woman with a lot of love for all colour, race and it is very sad to attact Obama,Please he is working for all America to give us a better life for our kids, to put food on our table, a roof for our family, he is a good man, please stop attacting him. Political ticker please print my comment.
MANY PEOPLE USE TO THINK MCCAIN WAS A MAN OF CHARACTER, CREDIBILITY AND RESPECT.
NOW HE HAS TRADED ALL OF THAT IN HIS LUST FOR THE RPESIDENCY.
WHAT A SAD, BITTER, ANGRY, PATHETIC OLD MAN!
MCCAIN = BUSH
PALIN = CHENEY
NO SURPRISE THERE!
McCain does not understand how the economy works so he does not even know if there is anything like companies shipping jobs that is Greek to McCain. So while I have to make better decision that affects my 16 months son and me I’ll rather go to someone who understands the economy and restoring American image abroad. We need a leader who can bring us together for common goal verses someone who is dividing us.
And Obama and Joe will lead us better
Dito on Niki's comment!!
THE ONLY THING MCCAIN AND PALIN HAVE ACCOMPLISHED IS INSIGHTING FEAR, RACISM, AND ANGER TO A WHOLE NWE LEVEL.
TO HELL WITH THEM BOTH.
I trust Senator Obama to do a lot to improve the lives of all of us. Having McCain would just be continuing the horrible nightmare of Bush and Cheney. We can't afford any more neocon war mongering leadership with a disregard for lives or our economy.
In Other News. . . Sarah Palin Has Been Found Guilty Of Abuse Of Her Power!
I would like to know if trickle down economics has kept jobs in the U.S. or has chased them out of the country. If not why are so many people out of work?
That might be why the housing market bottomed out and so many loans that were sold a hundred times over would have gotten paid.
Go figure !
McCain probably owns a business that takes jobs away from hardworking Americans and sends the same jobs to uneducated, America hating people who are willing to work for .25 cents a day. While Americans struggle. Huh! And you want this man to be your president. Have Fun!
This article just proved that Obama is lying when he talks about John McCain and you people can't see that? Your so much on the Obama bandwagon you don't see when good, unbiased journalism shows the facts
OF COURSE NOT, DUMB REARS!!!
Bush/Cheney- McCain/Palin, WOW is see no difference.