Kraft calls for revamp on overseas tax - FT.com

Kraft calls for revamp on overseas tax - FT.com: "The US policy of taxing corporate profits earned overseas is deterring companies from hiring workers and holding back business investment, according to Irene Rosenfeld, chief executive of Kraft Foods.
“I think certainly, for a multinational like ours, the issue of tax reform is really important,” Ms Rosenfeld said in a recent interview at the company’s headquarters in Northfield, Illinois. “Right now, we are taxed twice on income that we earn outside the United States, and that has an impact on how we think about our investment decisions.”"
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The food group’s chief executive said that revisiting the corporate tax structure was the most important thing that the next presidential administration could do to help create jobs. The tax structure, she said, would make US companies less competitive than their international counterparts.

“I do think it is something that I hope the new administration, whichever side of the aisle that it comes from . . . will address,” Ms Rosenfeld said.

US companies have been clamouring for a change to the system where they pay taxes to the US government and to foreign countries for profits earned overseas. Meanwhile, multinational companies have said repatriation taxes keep them from bringing cash held overseas back to the US.

The corporate tax structure has been a point of contention on the presidential campaign trail, with both candidates debating the impact of the system on unemployment. The latest government data showed the US economy adding 163,000 jobs in July, while the jobless rate ticked up to 8.3 per cent.

Mitt Romney, the Republican candidate, has called for a “territorial” tax system, in which income is only taxed where it is earned. Last week, President Barack Obama mocked that idea, saying it would encourage companies to hold money in foreign tax havens and would create nearly 1m jobs in other countries.

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