In late June 2014, the American Chamber of Commerce in Singapore (AmCham) sent five representatives to the annual Washington Doorknock organized by the Asia-Pacific Council of American Chambers of Commerce (APCAC). The Doorknock’s purpose is to bring the front lines perspective on major issues of concern to the American business community throughout the region.
Representatives of the participating chambers divided into four teams that collectively met with 60 congressional delegations (members and/or senior staff) over the course of four days. They also met with senior representatives of the Departments of State, Commerce, and Treasury, USTR, the NSC, several think tanks, and political commentators. In addition, they attended the gala reception hosted by the U.S. Chamber of Commerce and the U.S.-ASEAN Business Council in honor of Prime Minister Lee Hsien Loong.
Throughout these meetings, APCAC discussed the changing business environment and how the trade, tax, and investment rules need to keep up in order to make American businesses more competitive. Here is a short summary of the major issues that were discussed:
Trans-Pacific Partnership — Positive outlook with likely delays in sight
The Trans-Pacific Partnership (TPP), a trade agreement that the United States is negotiating with 11 other countries in the Asia-Pacific region, is a significant element of the Administration’s rebalance to Asia and key component of U.S. trade strategy in the region. The TPP is designed to promote trade and investment, support job creation, and foster economic growth and development among the partner countries.
In their meetings with the APCAC delegation, Administration representative expressed optimism about the negotiating progress. While many on the Hill were positively inclined on TPP and appreciated its strategic importance, they were not yet prepared to bring a Trade Promotion Authority (TPA) bill to the floor for a vote. Many delegations from both sides of the aisle in both houses expressed confidence that TPP would receive congressional approval.
Outside observers described to the APCAC delegation how U.S. political dynamics could affect TPP passage. They did not expect action on TPA before the mid-term elections. Several commented that it would be important to act on TPP before the onset of the presidential election cycle.
Amending U.S. Tax Law to Create a Level Playing Field
APCAC has advocated for over a decade in favor of U.S. tax reform to level the playing field for American companies and workers abroad. As the only developed country that taxes worldwide income, U.S. tax policy places American workers at a disadvantage since compensating for their tax obligations makes them more expensive than non-American counterparts. A negative consequence is a bias against hiring Americans. This results in fewer Americans in overseas offices of American companies.
Many on the Hill who favored tax reform said they were looking seriously at replacing our global taxation system with a territorial system such as all other major economies have, at least as it applies to corporate taxation. On the taxation of U.S. individuals living abroad, the understanding was far less advanced. Many Hill interlocutors were not aware of the taxation-related higher cost of hiring an American versus another nationality or of the consequences of a decline in the number of American citizens working for American companies abroad such as diminished soft power, procurement decisions that swing to other countries due to executives’ familiarity with their home markets, etc.
APEC Business Travel Card — Thank you for support
During the Doorknock, the APCAC delegation thanked key members of Congress for their support of the APEC Business Travel Card. The Card gives frequent business travelers pre-cleared, facilitated short-term entry to participating APEC member economies, saving valuable time at airports around Asia-Pacific. Over the past five years, AmCham Singapore campaigned with the Administration and the Hill for the APEC Business Travel Card. The U.S. government started issuing APEC Business Travel Cards to qualified U.S. travelers on June 12, 2014.
We in Singapore are especially grateful for the efforts of former Ambassador David Adelman and the CBP team at the Embassy for helping secure approval of the Card. We also owe special thanks to current Ambassador Kirk Wagar and Customs and Border Protection Attaché John Leonard for their special efforts to help us submit our signatures here that resulted in the first signature collection event with CBP at AmCham on June 20.
APCAC bands together 26 AmChams in 22 economies across the Asia-Pacific region. This allows the Chambers to speak with a unified voice to represent their 15,000 companies and 50,000 executives who live and run businesses in Asia.
Visit http://apcac.org to learn more about APCAC and access the APCAC 2014 Annual Report.