Time to stop rewarding firms that ship jobs abroad: Obama

Washington, Jan 25: Stepping up his campaign against outsourcing, US President Barack Obama on Wednesday announced a series of measures that would offer incentives to those firms which will create jobs in the country, a move that may also affect companies in India.

"If you're a business that wants to outsource jobs, you shouldn't get a tax deduction for doing it," Obama said in his State of the Union Address during which he presented an economic blueprint aiming to take his country away from outsourcing, bad debt and phony financial profits.

Many of his proposals centered on changes to the tax code, including limiting deductions for companies that move jobs overseas, rewarding companies that return jobs to the United States and increasing taxes on wealthy Americans.

He said that money should be used to cover moving expenses for companies that decide to bring jobs home. Indeed, Obama's anti-outsourcing job was mainly directed towards the manufacturing jobs in China; even though the new policies would also adversely affect outsourcing in India, which is often described as the world's back office.

"No American company should be able to avoid paying its fair share of taxes by moving jobs and profits overseas. From now on, every multinational company should have to pay a basic minimum tax. And every penny should go towards lowering taxes for companies that choose to stay here and hire here," he said.

"My message is simple. It's time to stop rewarding businesses that ship jobs overseas, and start rewarding companies that create jobs right here in America. Send me these tax reforms, and I'll sign them right away," Obama told lawmakers.

PTI