WASHINGTON (Reuters) - A few details of President Barack Obama’s business tax initiatives were spelled out on Wednesday by the White House after his State of the Union speech, in which he took aim at tax breaks he says reward U.S. firms for shipping jobs overseas.
More specifics will come when the president’s budget is published on February 13, together with his other “principles” for corporate tax reform, the White House said.
The president traveled to Iowa and Arizona on Wednesday to promote his plans aimed at creating more U.S. manufacturing jobs. His proposals include:
* Eliminating a tax break for moving expenses when a U.S. company ships operations overseas. Replacing it with a tax credit of 20 percent for the expense of moving operations back to the United States. The White House says this is revenue neutral and would not add to the deficit.
* Doubling the domestic production tax incentive for advanced manufacturers to 18 percent, while eliminating it for oil production, to urge manufacturers to create U.S. jobs.
* Closing a tax loophole that allows U.S. companies to shelter profits overseas from intangible property, like royalties from a drug patent. The White House says this would raise $23 billion in revenue.
* Proposing a new credit of $6 billion over three years for investments that help fund projects to improve economic activity in communities hit by major job losses or military base closures. To be done jointly with state economic development agencies.
* Proposing an additional $5 billion in an advanced energy manufacturing tax credit the White House says would leverage nearly $20 billion in U.S. clean energy manufacturing.
* Proposes extending for all of 2012 a provision to allow companies to deduct the full cost of investment in equipment, which the White House says yields $50 billion in tax relief over two years.
Reporting By Alister Bull; Editing by Kevin Drawbaugh and Cynthia Osterman