President Obama released the 2016 budget proposal yesterday, February 2, which calls for taxes on overseas revenues by US companies and a new approach to taxing foreign profits.
The ‘transition tax’ on overseas money imposes a 14 percent tax on US companies with overseas revenue, followed by a 19 percent tax on future profits.
“As part of transitioning to a reformed international tax system, the budget would impose a one-time transition toll charge of 14 percent on the up to $2 trillion of untaxed foreign earnings that US companies have accumulated overseas,” said the budget.
The one-time revenue would go to the Highway Trust Fund, financing the President’s six-year Surface Transportation Reauthorisation proposal.