Kent said raising taxes on profits earned overseas could make US multinationals less competitive

Kent said raising taxes on profits earned overseas could make US multinationals less competitive

The CEO of Coca-Cola Co has voiced concerns that the Obama administration’s plan to raise taxes on profits earned abroad for multinational companies will hurt the US economy.

Speaking to the Economic Club of Washington on Wednesday (19 May), Muhtar Kent told delegates that the proposed move could make US multinationals less competitive, with the result of reducing domestic investment.

“I want to express a deep concern that I and many others share about some of the tax policies that are being considered here in the US, policies that could potentially damage American business’ ability to create American jobs, invest in innovation, and compete in a healthy manner in a global economy,” Kent said.

“Today, more than ever, the US needs to do everything in its power to encourage investment, innovation and job growth in America.”

Kent said that the country needs a competitive tax structure on US companies' income from abroad to keep a level playing field with international competitors.

“In today’s growing and inter-connected global economy, American business’ success internationally is essential to our future competitiveness domestically,” he said.

Kent added that he supports a fair and equitable tax system that would help ease the fiscal pressures facing the US.

But he added: "Having one of the highest corporate tax rates in the world today - and having a system of foreign income taxation that is more onerous than that of any other developed country - does not bode well for America's future.”

In recent years, 27 OECD (Organisation for Economic Co-operation and Development) countries have reduced their top corporate tax rates. The US has not followed suit and now has the second highest rate among the 31 OECD nations, Kent noted.