Lawmakers are starting to see the outlines of a bipartisan agreement on how to tax the income that U.S.-based corporations earn outside the country.
Such a system would make it easier for U.S. companies to bring home foreign income that has been taxed elsewhere while preventing profits booked in low-tax or no-tax jurisdictions from receiving the same benefit.
The debate is between what tax analysts call worldwide tax systems and territorial tax systems.
Obama campaigned -- and won -- twice on curbing tax breaks that he says encourage U.S. companies to ship jobs overseas, signaling his intent to preserve the worldwide system. Each of his proposed annual budgets has called for limits on companies’ ability to defer U.S. taxation.