[Congressional Record Volume 141, Number 165 (Tuesday, October 24, 1995)]
[Senate]
[Page S15583]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




[[Page S 15583]]


          THE AMERICAN JOBS AND MANUFACTURING PRESERVATION ACT

 Mr. LEAHY. Mr. President, I rise as an original cosponsor and 
strong supporter of Senator Dorgan's bill, the ``American Jobs and 
Manufacturing Preservation Act.''
  Mr. President, many people in Washington talk about cutting corporate 
welfare. But my colleague from North Dakota has actually written 
legislation that will cut corporate welfare by $1.5 billion over the 
next 5 years. I applaud his commitment to ending corporate welfare as 
we know it.
  Over the years, big business and other special interests have lobbied 
hard for tax subsidies for specific industries. And, unfortunately, 
they have been successful on occasion. These wasteful special interest 
tax subsidies do not increase economic growth. To the contrary, 
wasteful special interest tax subsidies only add to our deficit, which 
puts a drag on our whole economy.
  Like an old-fashioned pork sausage, it is amazing what is actually in 
our Internal Revenue Code. This bill repeals one of the most infamous 
examples of ``corporate pork'' in our tax laws today--the tax deferral 
on income of controlled foreign corporations .
  Our tax laws allow U.S. firms to delay tax on income earned by their 
foreign subsidiaries until the profit is transferred to the United 
States Many U.S. multinational corporations naturally drag their feet 
when transferring profits back to their corporate headquarters to take 
advantage of this special tax break. But the millions of small business 
owners--who make up over 95 percent of businesses in my home State of 
Vermont--do not have the luxury of paying their taxes later by parking 
profits in a foreign subsidiary.
  The American Jobs and Manufacturing Preservation Act closes this tax 
loophole by taking aim at past abuses. It would end the tax deferral 
where U.S. multinationals produce abroad and then ship those same 
products back to the United States As a result, the bill terminates the 
current tax incentive for corporations to ship jobs overseas.
  The Progressive Policy Institute, a middle-of-the-road think tank, 
along with the liberal Center On Budget And Policy Priorities and the 
conservative Cato Institute, have all recommended that Congress repeal 
the tax deferral on income of controlled foreign corporations. Budget 
experts on the right, center, and left all agree that this tax deferral 
is a pork-barrel tax loophole just as wasteful as pork-barrel programs.
  Mr. President, I urge my colleagues to support the American Jobs and 
Manufacturing Preservation Act. 

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