Microsoft vs Obama, For the People and Jobs

Microsoft: Obama's tax plan may hurt U.S. jobs | Politics and Law - CNET News:

"Ballmer said Wednesday that if Congress enacts President Obama's plans to impose higher corporate taxes, a sensible thing for Microsoft to do would be to move jobs offshore.

'It makes U.S. jobs more expensive,' Ballmer said, according to Bloomberg News. 'We're better off taking lots of people and moving them out of the U.S. as opposed to keeping them inside the U.S.'

Last month, the president announced a plan to rewrite tax law by preventing U.S.-based multinational companies from 'deferring' and keeping profits offshore, which can lower their tax bills.

The current U.S. corporate tax system is unusual because it taxes income that Microsoft and other companies make in other countries, even if they already paid foreign taxes on that income. That makes U.S.-based companies less competitive than, say, Irish firms that don't pay taxes on foreign income and aren't hit by double taxation; deferred taxation is a way to lessen the sting.

If deferred taxation is eliminated, it becomes more tempting for a company to move its headquarters from Seattle to Dublin. That's voting with your feet.

That's why business groups have opposed the president's plan. The U.S. Chamber of Commerce says it will "impede growth in the U.S. economy, (and) cause the loss of jobs." The National Foreign Trade Council called it "counterproductive."

Microsoft says it employs about 95,000 people worldwide, and about 56,500 in the United States.