Ireland’s latest ally in the Obama overseas tax plan controversy is an unlikely candidate: Rush Limbaugh.
The ultra-conservative American political commentator is the latest public figure leading the charge against President Obama’s plan to close corporate tax loopholes on U.S. multinational corporations and crack down on overseas tax havens. The move would have serious, detrimental implications for the Irish economy, which is heavily dependent on the multinationals.
Ireland’s newest, albeit unusual, ally said on his radio show Wednesday: “You need to understand how Obama looks at businesses and individuals in this country. They exist to fund the government and any opportunity that anybody takes, even within the law, to limit their tax liability, he's going to find 'em and he's gonna change it. He refers to offshore tax havens and loopholes.”
There’s no question that Ireland is considered to be one of these tax havens; the country was one of three specifically mentioned upfront in the U.S. Treasury Department’s press announcement that accompanied Obama’s statement of his crackdown on tax loopholes. However, by Tuesday evening, the White House dropped any reference to Ireland from the announcement.
“These are not havens and loopholes,” said Limbaugh. “They are laws. There's a reason that some companies do business overseas. Labor is cheaper, their market is over there, or what have you.
"Here's what you have to understand…and it's delivered, by the way, in the kind of language that's designed to please the little guy. These people, these companies are cheating America. They're avoiding their taxes.
"The United States has the second highest corporate tax rate in the civilized, westernized, industrialized world. It is standard operating procedure that when there are tax laws that you can take advantage of that you take advantage of them.”
U.S companies have taken advantage of Ireland’s low corporation tax – at 12.5 percent – and invested heavily in Ireland, making the country one of the top locations for U.S investment in Europe.
At present, U.S companies can avoid paying taxes on profits earned abroad if they put those profits back into their overseas subsidiaries.
Obama's new tax plan is expected to raise $100 billion in revenue over 10 years.
Limbaugh defends the “little guy,” claiming the everyday, hard working Americans are the ones who will be hurt by Obama’s plan.
The controversial political pundit said: “All this is a massive tax increase and the supposed beneficiaries of all this, employees, the little guy employees, they are the ones that are going to get hurt. Liberalism's prescriptions always hurt the people intended to be helped.”
Major U.S. companies, such as Pfizer in Ireland, lobbied Congress in March to voice their concerns at the changes to the tax code, arguing that it would make U.S. firms less competitive.
Now, the addition of Limbaugh’s voice to the Irish cause could potentially be a huge influence in derailing the bill.
The radio host, as per usual, has his own prescription for overseas tax reform.
“What Obama should be doing and what he should have announced in January is a cut in the corporate tax rate and a suspension of the capital gains rate,” he said.
“This would have incentivized all kinds of investment and purchase of stock, equities, assets, in American businesses. It would have given them more capital to expand and higher. But that's not his objective. His objective is to control as much of it as possible. He wants to return the nation's wealth to its rightful owners and American corporations have way too much of America's wealth and they've come by it by cheating people and fleecing people and Obama's going to get even with them.
"This is going to cause employment in other countries, allied countries to be lost. The Brits are already concerned about jobs lost because of this. This is just a tax increase, pure and simple…nothing more.”
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