WASHINGTON — Rep. Shelley Berkley, D-Nev., said Tuesday she was preparing legislation that would grant a one-time tax break to U.S. companies overseas that return profits to the United States and use them to create jobs.
Berkley would allow funds that are "repatriated" to be taxed at a 25 percent rate, 10 percentage points below the normal rate.
Her catch is that the multinational companies must use the savings from the "America Jobs First Act" to boost their payrolls.
"With rising unemployment in Nevada, American companies should be creating jobs right here in the United States — not China," said Berkley, who sits on the House Ways and Means Committee.
"Instead of encouraging outsourcing, the American Jobs First Act will help companies start ‘insourcing’ good paying jobs right here in Nevada and across the country," she said.
Berkley is working with Rep. Adam Smith, D-Wash., on the bill, and did not say when it would be introduced. It was first reported by Bloomberg News.
Berkley has no estimates yet of how much money might be returned to the United States under her bill, how many jobs might be created or the cost of the corporate tax break to the U.S. Treasury, her office said.
As it is being written, the legislation conceivably could qualify Las Vegas Sands Inc., MGM Resorts and Wynn Resorts for tax breaks if they returned profits from their operations in Macau to boost employment at their Nevada properties. It was not known if those companies or others have weighed in with Berkley.
The Nevadan’s support for a repatriation measure is being seen as a sign that Democrats are warming to the corporate tax break after opposing it in the past.
Other Democrats, such as Sens. Charles Schumer of New York and John Kerry of Massachusetts, have said they would support a repatriation bill after voting against one in 2009, Bloomberg reported.
The concept is similar to a tax holiday bill that former Nevada Sen. John Ensign sponsored and that was enacted in 2004. That repatriation bill taxed returning profits at 5.25 percent.
A bipartisan group of lawmakers led by Reps. Kevin Brady, R-Texas, and Jim Matheson, D-Utah, introduced a bill in May that also would yield a 5.25 percent tax rate on repatriated profits for either 2011 or 2012.