Chamber Urges Senate to Support American Workers Abroad

Washington, D.C. - The United States Chamber of Commerce urged the Senate to protect American workers and their jobs by preserving the current tax treatment of income earned abroad as part of a broader tax relief package aimed at reinvigorating the economy.

"Robbing Peter to pay Paul is a poor tax strategy," said Thomas Donohue, U.S. Chamber President and CEO. "Senate plans to eliminate the income tax break for U.S. citizens working in other countries to pay for tax relief here at home hurts American workers and does nothing to help the economy."

Senate proposals to offset some of the tax relief package by increasing other taxes undermine the effectiveness of President Bush's jobs and growth initiative. In particular, the business community is opposed to the elimination of the tax exemption for income earned abroad. No other major, industrialized country in the world taxes the income that their citizens earn by working overseas, according to the Chamber.

In addition to their host country's taxes, Americans abroad must pay taxes on their benefits, allowances, overseas adjustments, and U.S. tax on income over $80,000.

"The tax exclusion for overseas income should be expanded, not scrapped," said Donohue. "These workers play a vital role in promoting our national interests, and their presence helps support U.S. exports and creates U.S.-based jobs."

U.S. companies operating overseas have made protecting the tax exclusion on overseas income a top priority. Business leaders from the American Business Council of Gulf Countries - a trade group affiliated with the U.S. Chamber of Commerce - are making the rounds on Capitol Hill this week, highlighting the competitive advantages to this part of the U.S. tax code.

"The U.S. Senate is in a position to protect U.S. jobs overseas - and the companies that employ these workers," said John Pratt, Chairman of the Persian Gulf-based business group. "Protecting Americans here and throughout the world should be lawmakers first priority."

The U.S. Chamber of Commerce is the world's largest business federation representing more than three million businesses and organizations of every size, sector and region.

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