The No Tax Breaks for Outsourcing Act is designed to close tax loopholes that allow U.S. corporations to reduce their tax bills by moving operations or profits overseas. The bill makes several major changes to the tax code: it requires companies to immediately report and pay taxes on foreign subsidiary earnings rather than deferring them, replaces the current global foreign earnings deduction with stricter country-by-country taxation rules, increases the foreign tax credit limit from 80% to 100%, limits interest deductions for large multinational corporations based on their share of worldwide interest expenses, and treats certain foreign corporations controlled by U.S. management as domestic corporations for tax purposes. Most provisions take effect for tax years beginning after December 31, 2024, with the domestic corporation rule taking effect two years after enactment. The bill affects large multinational corporations and investment firms, particularly those with over $100 million in annual revenue, by eliminating or reducing various tax advantages they currently use to lower their U.S. tax liability.
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