McCain, Hagan Introduce Plan To Bring Foreign Earnings Home

By Adrianna McGinley

At a news conference Thursday, Senators John McCain (R-Ariz.) and Kay Hagan (D-N.C.) introduced the Foreign Earnings Reinvestment Act, which would temporarily reduce the corporate tax rate in an effort to incentivize U.S. corporations that bring foreign earnings back to the U.S.

The bill proposes temporarily reducing the current 35 percent tax rate to 8.75 percent, and it could go as low as 5.25 percent for companies that use the repatriated money to create jobs at home. The bill would also penalize companies that lay off workers after participating in the program.

McCain emphasized it is a bipartisan proposal that needs to be passed immediately, citing it would introduce 50 to 80 billion dollars of tax revenue into the treasury and create two million jobs.

“Frankly, I don’t understand why anyone would be in opposition to a proposal that would bring $1.4 trillion back to this country to invest in jobs and create jobs and help the economy,” McCain said.

The two acknowledged though that the proposal is only meant as a temporary fix, and long term tax reform is necessary.

“The Foreign Earnings Reinvestment Act is not the only solution to our economic crisis. Unfortunately there is no single silver bullet, but that is no reason for inaction. We need practical bipartisan action to get our economy growing and growing now,” Hagan said.

The duo plans to introduce the bill as an amendment to the president’s jobs bill.