Obama Budget Raises $276 Billion From U.S. Multinationals

President Barack Obama is proposing more tax increases for U.S. multinational corporations, seeking ways to prevent them from avoiding taxes by exploiting gaps in international law.

In the fiscal 2015 budget proposed yesterday, the Obama administration seeks to generate $276 billion over the next decade from what it calls loophole-closing in the international tax system. The revenue -- 75 percent more than was sought through such changes in last year’s budget plan -- would be used to reduce corporate tax rates.

Among those affected by the revisions would be pharmaceutical companies looking to relocate to Ireland, technology companies selling cloud-based services outside the U.S., and non-U.S.-based companies borrowing money in the country.

The Obama plan isn’t likely to move forward in a divided Congress that can’t agree on the broad outlines of tax policy, let alone the details. The proposals instead set down a marker in the corporate tax debate, said Manal Corwin, national leader of the international tax practice at KPMG LLP in Washington.

“I don’t know that anybody’s predicting that we’re suddenly going to see tax reform happen,” said Corwin, formerly a Treasury international tax official in the Obama administration. “There are certain themes that seem to be repeating themselves.”

Obama, congressional Republicans and many U.S. multinational companies support reducing the corporate tax rate of 35 percent, which is the highest in the industrialized world.