President Obama arrives in the House chamber to deliver his State of the Union address on Tuesday night. (Photo By Bill Clark/CQ Roll Call)
What was not made clear in President Obama’s State of the Union speech Tuesday night was whether he’d be willing to sign a stand-alone bill to use profits of U.S. corporations now held overseas to pay for infrastructure.
Would he instead insist on a bill that included some of the tax increases that the White House sketched out over the weekend such as higher tax rates on dividends and capital gains?
Obama said Tuesday night that Congress must “close loopholes so we stop rewarding companies that keep profits abroad, and reward those that invest in America.”
The idea of using an overhaul of corporate taxes to come up with revenue for infrastructure was an element of his $302 billion Grow America Act unveiled last April.
But it’s an open question whether the president would sign a bill along the lines of the Partnership to Build America Act sponsored by Rep. John Delaney, D-Md. and Rep. Mike Fitzpatrick, R- Pa.
Sen. Roy Blunt, R-Mo., and Rep. Michael Bennet, D- Colo. have introduced a companion bill in the Senate.
The measure would let U.S. companies repatriate some of their overseas profits tax free if they invested them in infrastructure bonds.
Despite later in the speech lamenting the use of “gotcha” moments in politics, Obama took an opportunity to ding the proponents of the Keystone XL oil pipeline by saying “let’s set our sights higher than a single oil pipeline; let’s pass a bipartisan infrastructure plan that could create more than 30 times as many jobs per year” as the Keystone XL project.
Absent from Obama’s speech was any mention of the simplest, but politically unpalatable, expedient of raising the gasoline tax to pay for a new infrastructure bill. Obama did not join the chorus of those saying, ‘why not raise gasoline taxes since the price at the pump is now so low?’
As infrastructure advocates wait for the repatriation-for-infrastructure details to be worked out, their goals haven’t changed.
As American Road & Transportation Builders Association president Pete Ruane said Tuesday night, what they seek is “a long-term revenue stream to ensure state governments have the reliable federal partner they need to make overdue improvements to America’s roads, bridges and transit systems.”
And Patrick Jones, CEO of the International Bridge, Tunnel and Turnpike Association, said Obama and Congress ought to give states “greater flexibility to meet their individual transportation funding needs—including the right to use tolling on their existing Interstate highways for the purpose of reconstruction.”