Most of the American corporations were criticized keeping their profits overseas in order to avoid U.S taxes. According to the recent debate about increasing taxes on U.S multinationals, this decision will help creating jobs in U.S. as well as protecting the industry.
We do not think that this idea has a good shape for American economy. Because it discourage multinationals and companies to invest at home and response to the demand of foreign market, which I think is another protectionist practice made by Obama’s administration (Jay H., 2010).
Based on a report discussion how U.S. multinational companies strengthen the U.S. economy, it is proven that the expansion of US companies does not reduce a multinational firm’s domestic activities instead it does increase it. In my opinion, U.S. government should not increase taxation of multinational companies.
To demonstrate, here is an example of case study that was conducted by. It illustrates how porter & Gamble (U.S. multinational) generating over $25 million from its operation throughout the world especially in developing countries. Its global engagement contributes in creation jobs in the U.S. one in five P&G U.S. jobs and two in five Ohio based P&G jobs depends directly on its global business (Matthew J.S., 2009).
However, if we think about all those U.S. multinationals operating globally, their global engagement will certainly have great benefits for U.S. economy as well as on creation new job opportunity. For this particular reason, It is not appropriate to raise tax on U.S. multinational companies because as republican argue, it will decrease jobs in U.S. private sector. We have to think about the global market and what is good for United State within the next coming years.
In addition, US companies can operate from USA and export its products to other countries. However, US corporations compete against companies from around the world in an increasingly global marketplace, in addition to some demand and cost factors.
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