A crackdown on US companies avoiding tax by shifting their operations overseas has been launched by US President Barack Obama.
The move, which could have major implications for US multinationals, including those based in Ireland, is a bid to stop jobs flowing out of the US to low tax economies.
The plan aims to bring jobs and tax income back to the US, and is being fiercely resisted by the business lobby.
It will have to be passed by both Houses of Congress before becoming law.
The president said he wanted the new laws to come into effect in 2011.
At present, US companies in Ireland do not pay US tax on profits they re-invest in Ireland.
Nor do the companies involved pay US taxes on profits earned overseas until they repatriate those profits.
Today's announcement by President Obama on reforming US international tax policy involves, among other things, a review of a so-called deferral scheme.
It is understood that many of the US companies in Ireland are beefing up their operations in Washington so that they can lobby on the proposed changes.
It is also understood that the Industrial Development Authority is increasing its operation in North America to identify investment opportunities for Ireland that might emerge from President Obama’s multi-billion dollar stimulus plan, along his legislative programme - which includes his tax reform policy.
