Center for Freedom and Prosperity
For Immediate Release
Tuesday, June 13, 2006
Coalition Applauds Senator Jim DeMint's Leadership on Making Americans More Competitive Overseas
(Washington, DC, Tuesday, June 13, 2006) – Today, several members of the Coalition for Tax
Competition applauded Senator Jim DeMint's (R-SC) leadership for introducing legislation to eliminate the double taxation of Americans living and working overseas. The legislation,
entitled "Working American Competitiveness Act,"
would enable U.S. citizens to compete for international jobs on a level playing field with citizens of other nations.
Andrew Quinlan, president of the Center for Freedom and Prosperity said, "Americans should not be penalized with a second layer of tax for working overseas. Senator DeMint's bill is a great step toward creating a level playing field, which will lead to more Americans working in the global economy, more U.S. companies becoming internationally competitive, and more U.S. exports leading the way to economic growth."
The DeMint legislation (S. 3496)
is needed because the United States is among the tiny handful of nations that imposes double-taxation on the labor income that individuals earn in other nations – even if the U.S. citizen is a full-time resident of the foreign jurisdiction. Yet since the "foreign-source" income of U.S. citizens already is subject to all applicable taxes that exist in other jurisdictions (just as the United States taxes foreigners who live and work in America), an additional layer of U.S. tax is double-taxation – thus violating one of the most important principles of good tax policy. Every other industrialized country in the world taxes only income earned inside national borders – the common-sense principle of "territorial taxation."
Additional comments on the DeMint legislation by Coalition Members:
John Berthoud, President, National Taxpayers Union ~ "The National Taxpayers Union applauds Senator DeMint's legislation which is both good for American workers and good for competitiveness."
Karen Kerrigan, President & CEO, Small Business & Entrepreneurship Council ~ "We strongly endorse Senator DeMint's efforts to improve the tax code and help Americans compete on a level playing field with citizens of other nations."
Grover Norquist, President, Americans for Tax Reform ~ "American
tax policy continues to thwart our nation's international competitiveness. Taxing workers income and corporate profits earned outside the United States provides the incentive for more capital being invested
overseas. Congress should immediately repeal any taxation of foreign earned income for U.S. workers."
Representatives of think tanks are unable to endorse legislation, but did comment on the economic impact of America's punitive tax treatment of overseas Americans:
Daniel Mitchell, The Heritage Foundation ~ "Current tax law undermines the competitiveness of U.S. companies and U.S. workers by imposing a second layer of tax on Americans who live and work abroad – a burden that does not exist for citizens of any other developed nation."
Veronique de Rugy, American Enterprise Institute ~ "America's treatment of citizens competing in the global marketplace is more onerous than the policies of high-tax welfare states such as France and Sweden. Section 911 of the tax code enables overseas Americans to protect some income from double-taxation, but a fully territorial system is needed to create a true level playing field."
For additional comments:
Andrew Quinlan can be reached at 202-285-0244, firstname.lastname@example.org
John Berthoud can be reached at 703.683.5700, email@example.com
Karen Kerrigan can be reached at 202-785-0238, firstname.lastname@example.org
Grover Norquist can be reached at 202-785-0266, email@example.com
Dan Mitchell can be reached at 202-608-6224, firstname.lastname@example.org
Veronique de Rugy can be reached at 202-862-7165, VdeRugy@aei.org