back FOR IMMEDIATE RELEASE  CONTACT: October 7, 2004 Kate Dwyer: 202-226-7326 Ryan Votes to End Sanctions on American Products, Provide Tax Relief for U.S. Job Creators WASHINGTON –  The U.S. House of Representatives today approved by a vote of 280-141 the House-Senate compromise version of legislation written to end harmful sanctions on American products and boost American job creation by providing tax relief for domestic manufacturers and businesses.  As a member of the House Ways and Means Committee, Wisconsin’s First District Congressman Paul Ryan helped shape this legislation and voted in favor of the measure – the Conference Report for H.R. 4520, the American Jobs Creation Act of 2004 – because it will help Wisconsin businesses stay competitive and encourage new job growth.  The next step is for the Senate to vote on this legislation.     “Enacting this law soon is extremely important for Wisconsin manufacturing jobs,” Ryan said.  “Wisconsin manufacturers are now competing at a global disadvantage because of problems with the tax system.  We have to correct this so we can sell more top-quality Wisconsin products in other countries, not fewer.  Lowering the heavy tax burden on American manufacturers so they can better compete, while staying in the U.S., will also help retain and create jobs in Wisconsin.   The legislation repeals a U.S. export tax subsidy known as FSC-ETI in order to end tariffs that are hurting America’s manufacturers and farmers.  European Union sanctions on U.S. products currently stand at 12 percent and are increasing by 1 percentage point each month until FSC-ETI is repealed.  In addition, the measure contains key provisions to improve American businesses’ ability to compete worldwide, such as lowering corporate tax rates – which are among the highest in the world – for domestic manufacturers.  It also reduces double taxation of U.S.-based companies and includes tax incentives for small businesses such as enhanced expensing of new investments.  If enacted, H.R. 4520 will help retain and create jobs in Wisconsin and throughout the rest of the nation by: Ending sanctions on American products. Escalating European Union tariffs are increasing the price of U.S. goods sold overseas, thus reducing U.S. exports. Lower U.S. exports mean fewer U.S. jobs. This legislation moves to end these sanctions by repealing the part of our international tax law (FSC-ETI) that violates World Trade Organization rules. Reducing corporate tax rates. Through a nine percent tax deduction, the legislation effectively reduces the top corporate tax rate from 35 percent to 32 percent for domestic manufacturers. That is, U.S. manufacturers will pay lower tax rates if they produce their goods in America. The deduction is available to C corporations, S corporations, partnerships, sole proprietorships, cooperatives, and estates and trusts. Income from overseas production will not get this reduced rate. Such tax relief sparks job growth in the United States.  Providing tax incentives for small businesses. The measure contains important tax incentives for small businesses, which are engines of job growth. These include the extension of enhanced section 179 expensing so that small businesses can immediately expense up to $100,000 of new investments through 2007.  Simplifying international tax law and enhancing U.S. competitiveness. Currently, U.S. companies that do business overseas are taxed twice on the income they earn overseas. They are taxed both in the United States and in the country where the income is earned. This double taxation is only partially offset under current law. This legislation reduces double taxation of U.S.-based businesses engaged in the global market and simplifies complex international tax law. Reducing double taxation will give companies an incentive to keep jobs in the United States.   back