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Rep. Delaney Hopes Pfizer Anger Will Fuel Infrastructure Bill (Correction)

A previous version of this story incorrectly stated that 40 Senators support the proposed infrastructure bill from Sens. Roy Blunt (R-MO) and Michael Bennet (D-CO). This story has been corrected to reflect the fact that 13 senators support the legislation.

NEW YORK (TheStreet) --Anger over tax-driven megadeals has been reignited by Pfizer's (PFE - Get Report) proposed acquisition of AstraZeneca (AZN - Get Report), and Rep. John Delaney is hoping to harness that outrage to help build momentum for his trademark infrastructure legislation.

Delaney's proposal, the Partnership to Build America Act, allows U.S. companies to repatriate earnings stashed overseas tax free provided they use some of it to buy infrastructure bonds. The bonds, which pay a low interest rate over 50 years, pay for $750 billion in infrastructure with no increase in government spending.

Pfizer proposes to use overseas cash to pay for its AstraZeneca, a move that wouldn't be as attractive if it could bring the cash back to the U.S. tax free, Delaney argues.

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"If they bring it back they only get 70 cents on the dollar so it basically gives them cheaper money to do a deal like this."

Apart from his legislation, however, Delaney argues more comprehensive tax reform is needed. He favors moving to what he calls a modified territorial tax system that would allow U.S. companies to repatriate earnings once they have paid a minimal amount of tax in foreign jurisdictions.

"I don't think we've got to match the lowest bidder in the world, but we shouldn't have these double taxes," Delaney says.

Delaney claims 31 Democrats and 32 Republicans support his proposal in the House and as of last week 13 Senators supported a companion bill from Sens. Roy Blunt (R-MO) and Michael Bennet (D-CO)

But liberal Democrats may be a tougher sell.

Delaney told me in March he believes 10% to 15% of the 200 Democrats in the House believe that "what US corporations are doing...in terms of creating all this overseas cash is just fundamentally at some level evil. They're hiding money overseas and they're shifting jobs overseas which is why we're creating all this cash overseas and we should not be reforming this system to facilitate [money] flowing back. We should be applying a mandatory tax on all international earnings."

Still, Delaney cited "some liberal people in the Senate who have been very outspoken like Chuck Schumer (D-NY) [who have] been very positive on the notion of using repatriation dollars to fund infrastructure like our bill."

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