Although exporting your services overseas may seem like a cost-efficient practice, President Barack Obama's State of the Union Address reveals he'd like to enforce strict laws so that all American companies share the same tax laws, regardless of where their employees are working.
According to the President's address, companies currently benefit from tax breaks for exporting jobs and profits overseas. However, this is to no fault to the American business owner that is outsourcing in an attempt to avoid the highest tax rate in the world. American business owners who choose to operate in the United States are encouraging locally-owned business, but the United States government's tax rates don't make that practice financially beneficial. President Obama suggested that all business owners that outsource should pay a standard tax rate and those taxes should support businesses that choose to operate in the United States. "So my message is simple. It is time to stop rewarding businesses that ship jobs overseas, and start rewarding companies that create jobs right here in America. Send me these tax reforms, and I will sign them right away," Obama stated. While there isn't a timetable for an outsourcing business tax reform as of yet, as a company considering a move overseas, you may have to prepare for one in the coming years.