Joe Biden pledged to penalise American companies that move jobs overseas and reward businesses that employ people in the US, as he rolled out a “Made in America” plan to help woo voters in the industrial Midwest.

Mr Biden, the Democratic presidential nominee, said his administration would pursue tax reforms designed to undo measures included in Donald Trump’s 2017 tax cut legislation that reduced the impetus for companies to bring jobs back to the US.

“The Trump tax giveaway is upside down and backwards. We should be penalising offshoring, not rewarding it,” the Biden campaign said ahead of a visit by the former US vice-president to Michigan, a swing state, on Wednesday.

Mr Biden’s campaign said he would force companies to pay a corporate tax rate of 30.8 per cent on profits generated by the overseas production of goods that were sold back into the US market.

The figure would include a base corporate tax rate of 28 per cent and an additional “offshoring tax penalty” of 2.8 percentage points. The tax would also apply to companies that use overseas call centres to service customers in the American market.

As part of his pitch to voters that Mr Trump has not met his 2016 pledge to return manufacturing jobs to the US, Mr Biden said he would provide a 10 per cent tax credit to companies that create new jobs domestically, either by returning jobs from overseas or doing things such as revitalising previously shuttered facilities and plants.

Mr Biden would require Congressional support to enact any changes to the tax code — a prospect that would face stiff opposition if the Republicans maintain control of the Senate. But he also pledged to issue two executive orders in his first week in office to promote “Buy America” policies.

READ ALSO  How Trump’s Supreme Court pick could reshape law on abortion and guns

His campaign said he would use the Defense Production Act — a Korean war-era law that lets the government force companies to take actions for national security reasons — for the fulfilment of federal contracts.

Mr Biden released the plan as he prepared to go to Michigan as part of his new strategy to campaign in swing states after months of running a virtual campaign from his Delaware home. Michigan was one of three swing states — along with Wisconsin and Pennsylvania — that Mr Trump won in 2016.

Line chart showing how Trump and Biden are doing in the US national polls

Mr Biden is hoping that his working-class background and union support will help win back some of the blue-collar Democrats in the Midwest who helped Mr Trump notch up surprise wins against Hillary Clinton in 2016.

The former vice-president leads Mr Trump in Michigan by an average of 3 points, according to Real Clear Politics, but enjoys wider margins in Wisconsin and Pennsylvania.

Follow Demetri Sevastopulo on Twitter


Via Financial Times