Another political setback for Gov. Patrick?

Governor Deval Patrick's quest to tighten corporate tax laws and reap hundreds of millions of dollars in new revenue might be undermined by a last-minute amendment providing new offshore tax breaks that was tacked onto the legislation by the House, according to state officials.

The complex amendment was backed by the House leadership and approved with little debate during mid-evening voting two weeks ago as representatives were adopting the overall tax package. Several lawmakers said they were unaware of the details of the provision, which was sought by the state's largest business lobbying group.

The provision would permit large corporations to avoid up to $200 million in state taxes a year if they maintain large portions of their business operations overseas, according to an estimate by the state Department of Revenue. The tax-shelter strategy has proved controversial in other states.

Administration officials say the maneuver could essentially make a wash of the revenue raised by corporate tax reform, a cornerstone of Patrick's agenda that was expected to bring in $217 million in the first six months of 2009.

"It would allow companies to shift money overseas and avoid taxes in Massachusetts," Navjeet K. Bal, the state's revenue commissioner, said in an interview yesterday. "This is a real concern for us."

The offshore tax break still must be considered by the Senate, along with the rest of the tax bill, before reaching Patrick's desk. Through a spokesman, Patrick said the administration will lobby senators to change the plan.

"We look forward to continuing to work with the House and the Senate to craft a final loopholes plan that will ensure tax fairness and provide much needed revenue," said the governor's spokesman, Kyle Sullivan.

UPDATE: More from the Herald.