The White House Monday unveiled a $210 billion plan to tax more of U.S. firms' overseas earnings and crack down on tax avoidance -- including a new measure to shut down a tax maneuver by foreign hedge funds.

In the hedge fund transactions, U.S. banks including Lehman Brothers Holdings Inc. (LEH), Morgan Stanley (MS) and Citigroup Inc. (C) used complex swaps to help foreign investors reap the benefits of investing in the U.S. stock market, without having to pay a 30% withholding tax.

That proposal is just one aspect of a raft of tax changes the Obama administration would make affecting U.S.-related income that moves across national borders. President Barack Obama is looking to reduce the deficit and pay for pricy new domestic programs, and he has long made clear he believes the U.S. international tax rules are ridden with loopholes and need fixing.

Most of the money that would be raised from tax changes in the international area -- $189.5 billion out of a total $210 billion -- would come from changes Obama announced last week to tax more of firms' foreign profits right away. U.S. companies say the proposals would hamper their ability to compete in the global marketplace.

The Obama tax proposals do not include a plan to limit foreign insurers' ability to re-insure their own policies -- a practice some Capitol Hill Democrats allege is done to avoid U.S. taxes. That is a victory for foreign insurers including Swiss Re and ACE Limited (ACE), and a defeat for U.S. proponents like W.R. Berkley Corp. (WRB) and Chubb Corp. (CB).

The proposal affecting hedge fund dividend swaps was championed by Sen. Carl Levin, D-Mich.

Another new proposal would restrict income shifting by a U.S. company to a foreign subsidiary, by transferring patents or other intangible property.

Another would repeal the ability of U.S. companies that derive at least 80% of their income from foreign business to treat interest and dividends as exempt from U.S. withholding tax.

Besides the international tax measures, the Obama budget proposes $735.5 billion in tax cuts for individuals over the next 10 years, which have been announced previously.

The primary item, the "making work pay tax credit," would deliver a $535 billion tax cut through 2019 for qualifying individuals; the expanded child tax credit for lower income families would deliver $70.9 billion in tax relief while the expanded saver's tax credit and automatic enrollment in IRAs would provide $59.6 billion in relief.

-By Martin Vaughan, Dow Jones Newswires; 202-862-9244; martin.vaughan@dowjones.com