Congress moves to lock in a $10B+ tax break for multinational corporations
H.R. 1062 — Growing and Preserving Innovation in America Act of 2025 · Filed by Randy Feenstra (R-IA) · 7 cosponsors · Introduced Feb 6, 2025 · Referred to committee
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What it does
This bill permanently blocks a scheduled reduction in the tax deduction for foreign-derived intangible income (FDII). Under current law, the deduction was set to shrink from 50% to 37.5% in 2026; this bill keeps it at 50%, preserving a tax break for U.S. corporations on profits from intellectual property and intangibles earned abroad. The primary beneficiaries are multinational corporations with significant foreign IP income.
Why we flagged it
The bill's sole operative effect is to preserve a tax deduction for multinational corporations, preventing a scheduled reduction in that deduction. This is a direct tax benefit to a narrow private sector.
What the text implies
- The bill does not specify which corporations benefit most, but the FDII deduction is primarily claimed by large multinational firms with substantial foreign intangible income (tech, pharma, finance). Smaller domestic-focused businesses do not benefit.
- Preserving the 50% deduction instead of allowing it to drop to 37.5% costs the federal government an estimated $10–15 billion over ten years (per CBO estimates of similar provisions), revenue that would otherwise reduce the deficit or fund public services.
The full analysis lists 3 implications of this text.
Who stands to gain
multinational corporations with foreign-derived intangible income; technology companies; pharmaceutical companies