(Bloomberg) — President Barack Obama's proposal to tax the offshore profits of U.S. corporations could encourage all but the largest companies to follow their cash hoard overseas, according to business leaders and tax lawyers.

The plan would levy a one-time tax of 14 percent on the $2.1 trillion U.S. companies have stockpiled abroad, sidestepping the Internal Revenue Service. It also calls for a 19 percent minimum tax on future foreign earnings. The prospect of those increased taxes could spur some companies to relinquish their U.S. residency altogether — either by merging with a foreign partner in a corporate inversion or finding a foreign buyer, according to J. Richard Harvey, a former senior official for the Treasury Department and the IRS.

Tax lawyers said there could even be a rush to do so to avoid limitations the administration is also proposing on inversions, in which U.S. companies shift their addresses overseas to tax-friendly locations.