|
?:reviewBody
|
-
Alison Lundergan Grimes, the Democratic Senate candidate from Kentucky, says that as Mitch McConnell’s wealth has grown, he has hindered Kentucky’s prosperity. Recently, we looked at an ad in which Grimes said McConnell, the incumbent Senate minority leader, made millions while in public office. We rated that claim Mostly False . But that was only one of several claims in the ad that attacked McConnell for being out-of-touch with average Kentuckians and biased toward the wealthy. Another claim caught our attention: McConnell voted three times for corporate tax breaks that send Kentucky jobs overseas. We’ve noticed that this claim -- that a candidate voted for tax breaks that send jobs overseas -- is a trending talking point among Democratic candidates, and we’ve found that often the claim is simplistic and misleading. So we decided to see whether or not Grimes’ claim about McConnell stacks up. The votes The ad makes it sound as if McConnell voted three times to approve corporate tax breaks that incentivize outsourcing specifically. This is not the case. For evidence for its claims, the Grimes campaign pointed us to information on their website . All three no votes were on legislation that sought to close already-existing corporate tax deductions. These deductions did not pertain to outsourcing specifically because under current law, there is no special provision that gives corporations a deduction or any kind of tax break for moving employees out of the country. McConnell’s first no vote was in 2010 on the Creating American Jobs and Ending Offshoring Act . The second and third no votes were on the Bring Jobs Home Act , which was proposed in 2012 and again in 2014. These votes, split almost exclusively along party lines, were on procedural measures that ultimately prevented the bills from receiving a final passage vote. Both laws would have given a tax benefit to companies that insource jobs and denied an already-existing tax break to companies that outsource them. The tax breaks that the law would have stopped are actually standard business expense deductions . Companies can write off many business-related expenses as tax-deductible -- including relocation. But this isn’t a special provision just for businesses that move outside of the United States. A business would get the same deductions for money spent moving from New York to California. Tax experts we spoke with said the law was almost entirely symbolic. The amount of money associated with these standard deductions is minuscule, compared to corporate tax revenue overall. So minuscule, in fact, that getting rid of deductions for business expenses associated with outsourcing would not be nearly enough to affect a company’s decision to engage in foreign activity. It adds up to a trivial amount of money, said James Hines, a professor of law and economics at the University of Michigan. Given how many big multinational firms we have, it’s impossible that it has any effect on their behavior. Eliminating standard deductions for costs associated with outsourcing would result in an average $14.2 million a year in revenue, according to Joint Committee on Taxation estimates. That’s not much in the grand scheme of things. For some perspective, the Internal Revenue Service took in $273.5 billion in corporate income taxes in 2013 alone, according to the Tax Policy Center, a research group, based on Office of Management and Budget data. Revenue from eliminating that deduction would amount to 0.005 percent of total revenue. Among Republicans’ reasons for opposing the Bring Jobs Home Act, the policy would have lost revenue and added to the deficit, according to Congress’ Joint Committee on Taxation . The government would have spent more money on the tax credit for insourcing than it would have raised by eliminating deductions related to outsourcing. Overall, the policy would have resulted in an estimated $214 million loss over 10 years. Our ruling Grimes said McConnell voted three times for corporate tax breaks that send Kentucky jobs overseas. The ad makes it seem like McConnell voted to approve corporate tax breaks that incentivize outsourcing. Actually, he voted no on legislation that would have eliminated the standard business expense deductions -- which exist for all businesses -- for costs associated with outsourcing. (Current law includes no provision that specifically addresses insourcing or outsourcing.) These bills had little chance of passing, and they were largely symbolic. We rate this claim Mostly False.
(en)
|
![[This page as RDF]](http://data.gesis.org/claimskg/static/rdf-icon.gif){kind=icon}