Sec. 899 Eliminates 700,000 American Jobs, Erases $100B from GDP Annually
WASHINGTON, D.C. — The Global Business Alliance (GBA) released a new report, The ‘Revenge Tax’ Slowdown, that for the first time examines the economic harm that the Section 899 tax hike within the One, Big, Beautiful Bill (OBBB), commonly referred to as the “revenge tax,” will inflict on U.S. workers and America’s economic growth.
“This report should give any policymaker evaluating the merit of Sec. 899 serious pause,” said Jonathan Samford, GBA’s president & CEO. “Not only does this one provision wipe away one-third of the One, Big, Beautiful Bill’s economic growth potential, it eliminates 700,000 American jobs and erases $100 billion of U.S. GDP annually in the long run. Sec. 899 is a blueprint for decline: smaller paychecks, fewer jobs, shuttered operations, lost innovation and weakened economic competitiveness. Considering this sobering state-specific analysis, I urge the U.S. Senate to maximize the full economic growth potential of the One, Big, Beautiful Bill by removing this punitive and discriminatory provision.”
This first-of-its-kind analysis of the Sec. 899 tax hike shows it would reduce investment and eliminate hundreds of thousands of U.S. jobs, according to an independent third-party analysis. This tax provision specifically punishes companies that invest, build and hire in the U.S.—particularly in manufacturing and R&D. It will also lower U.S. wages, total investment and labor supply. The analysis also shows that Sec. 899 erases a full one-third of the OBBB’s pro-growth potential.
State-specific Impacts
“While proponents say this punitive tax hike is intended as a retaliatory measure against foreign governments, this report confirms that the real victims are American workers in states like North Carolina, South Carolina, Indiana, Tennessee, and Texas,” Samford said.
The new report includes state-by-state specifics on how many companies are targeted, jobs lost, and economic growth erased by the Sec. 899 tax hike. Here are a few examples of the job losses outlined in the report:
- South Carolina: 12,900 jobs lost
- Indiana: 16,100 jobs lost
- Tennessee: 16,500 jobs lost
- North Carolina: 24,500 jobs lost
- Texas: 61,700 jobs lost
‘Direct Contradiction’ of President Trump’s Economic Vision
“Sec. 899 punishes companies for investing and creating jobs in America, in direct contradiction of President Donald Trump’s vision for attracting more investment to America,” Samford added.
In February of this year, President Trump issued his America First Investment Statement, which states, “Welcoming foreign investment and strengthening the United States’ world-leading capital markets will be a key part of America’s Golden Age …. My Administration will make the United States the world’s greatest destination for investment dollars.”
The Joint Committee on Taxation (JCT) expects that the Sec. 899 provision will collect less and less revenue starting in 2029 and even lose nearly $13 billion in tax revenue in 2033 and 2034, as targeted employers are forced to scale back their U.S. operations.
“On behalf of the 8.4 million Americans who earn a living at an international company, including nearly one in four U.S. manufacturing workers, I urge the Senate to maximize the pro-growth spirit of the OBBB by removing this punitive and discriminatory provision. Doing so will ensure that America remains the most attractive place in the world to invest, hire, and innovate,” Samford said.
This report was based on economic analysis prepared on behalf of GBA by the EY Quantitative Economics and Statistics (QUEST) practice. While independently developed, its model aligns with the analytical best practices of the federal government’s top economic scorekeepers.
View the full report, The ‘Revenge Tax’ Slowdown, on GBA’s website at globalbusiness.org/Sec899JobLoss.