For Immediate Release
Friday, May 16, 2003
Ensign Repatriation Amendment Passes By 3-1 Margin: Shift Toward Territorial Taxation
Will Bring Capital to US Economy
Washington, DC (May 16, 2003) – The Center for Freedom and Prosperity today praised Senator John Ensign (R-NV) for amending the Senate tax bill to temporarily slash an onerous tax penalty that
discourages companies from investing their foreign-source income in America. Senator Ensign's amendment, which was co-sponsored by Senators George Allen (R-VA), Barbara Boxer (D-CA), and Gordon Smith (R-OR), lowers
the tax rate on repatriated profits from 35 percent to 5.25 percent, a reform that experts predict could attract several hundred billion dollars to the U.S. economy.
Andrew F. Quinlan, President of the Center for Freedom and Prosperity, stated that, "Senator Ensign and his colleagues should be commended. Reducing the double-tax on foreign-source income will
encourage companies to invest money in the US economy. The Center for Freedom and Prosperity strongly supports this much-needed reform."
Heritage Foundation tax expert Daniel J. Mitchell commented that, "The Ensign amendment is an important step toward fundamental tax reform. Companies should not be taxed on income earned in other
nations, and the Ensign amendment demonstrates that lawmakers understand that shifting closer to a territorial tax system – even if only temporarily – will increase investment at home and boost competitiveness
Veronique de Rugy of the Cato Institute added, "The bipartisan Ensign amendment helps offset the anti-growth features of the existing corporate income tax. Combined with real relief from the
double-taxation of dividends, reducing the tax penalty on repatriated profits will make American companies more competitive."
Because the House and Senate must agree on legislation before it is sent to the President for approval, the Ensign amendment does not necessarily mean the change will become law. As such, the Center
for Freedom and Prosperity announced that it will augment its busy Hill schedule with more meetings to explain the benefits of competitive international tax policy. According to Quinlan, "We will not rest until
everyone understands that high tax rates and worldwide taxation undermine America in the global economy."
For additional comments:
Andrew Quinlan can be reached at 202-285-0244, firstname.lastname@example.org
Dan Mitchell can be reached at 202-608-6224, email@example.com
Veronique de Rugy can be reached at 202-842-0200, firstname.lastname@example.org
Center for Freedom and Prosperity
P.O. Box 10882
Alexandria, Virginia 22310