The U.S. Now Has The Highest Corporate Tax Rate In The Developed World And Obama Has Plans To Make It Worse
______________________________________
JAPAN CUTS THEIR CORPORATE TAX RATE, LEAVING THE U.S. WITH THE DUBIOUS DISTINCTION OF THE HIGHEST TAX RATE IN THE DEVELOPED WORLD
"[Today], The United States Gets A Distinction No Nation Wants -- The World's Highest Corporate Tax Rate." (Chris Isidore, "U.S. Corporate Tax Rate: No. 1 In The World," CNNMoney, 3/27/12)
Japan Cuts Its Corporate Tax Rate Today, Leaving The U.S. With The Highest Rate In The Developed World. "Japan, which currently has the highest rate in the world -- a 39.8% rate on business income between national and local taxes -- cuts its rate to 36.8% as of April 1. The U.S. rate stands at 39.2% when both federal and state rates are included." (Chris Isidore, "U.S. Corporate Tax Rate: No. 1 In The World," CNNMoney, 3/27/12)
Earlier This Year, Canada Cut Their Rate To 15 Percent And Today Great Britain Will Cut Their Rate To 24 Percent. "The attention given to the Japanese rate cut has overshadowed the fact that Great Britain also cut their corporate tax rate on April 1 st from 26 percent to 24 percent, and will cut the rate again to 23 percent in 2013. Moreover, on January 1st of this year, Canada cut its federal corporate tax rate from 16.5 percent to 15 percent. Canada's combined rate is about 26 percent when the average rate of the Canadian provinces is added to their federal rate." (Scott A. Hodge, "The Countdown Is Over. We're #1," The Tax Foundation, 4/1/12)
OBAMA'S CORPORATE TAX PROPOSALS WOULD RAISE TAXES ON THE MIDDLE CLASS, ADD MORE LOOPHOLES AND HURT SMALL BUSINESSES
Obama's Tax Increases Would Raise Taxes On 27 Percent Of All Households, Breaking His Pledge Not To Raise Taxes On The Middle Class. "Obama focuses the tax increases in his 2013 budget on corporations and the top 2 percent of individual taxpayers. The result in the center's study stems from the fact that taxpayers in all income brackets own parts of corporations. 'There are enough corporate tax increases in the president's plan to have a measurable impact on the distribution,' said Roberton Williams, a senior fellow at the center, which is frequently cited by members of both parties for its work." (Richard Rubin, "Obama Budget Raises Taxes For 27% Of Households, Report Says," Bloomberg, 3/21/12)
Obama's Corporate Tax Framework Would Complicate The Tax Code And Extend
Manufacturing Credits Far Beyond The Factory Floor. "A Reuters analysis of company filings and government data shows how broadly the deduction is now used, suggesting it may be nearly impossible to keep it focused on manufacturing. Corporate America's army of tax lawyers will be at the ready. From Starbucks Corp to Time Warner Cable Inc, businesses far beyond traditional manufacturers use the benefit, Reuters found." (Kim Dixon, "Analysis: Tax Break Goes Far Beyond The Factory Floor," Reuters, 3/8/12)
Jay Timmons, National Association Of Manufacturers: "Many Of The Proposals Completely Miss The Mark And Would Make U.S. Businesses Less Competitive." "Even the manufacturing industry, which would have its top tax rate capped at 25%, offered a tepid read of the plan. 'The president suggests some changes that will help, but many of the proposals completely miss the mark and would make U.S. businesses less competitive,' said Jay Timmons, chief executive of the National Association of Manufacturers." (Damian Paletta and John McKinnon, "Obama Proposal Gets Pushback," The Wall Street Journal , 2/23/12)
Obama's Corporate Tax Plan Won't Help Small Businesses And "Leave Many Business Owners With Higher Tax Bills." "Last week, President Barack Obama released a proposal to lower the federal corporate tax rate - a move that on its face would seem to be good news for small businesses. But the president's pitch isn't getting rave reviews. Advocates for small business say the plan would benefit a relatively low number of small companies and leave many business owners with higher tax bills." ("Small Business Community Says Obama Corporate Tax Plan Will Only Benefit A Few," The Associated Press , 3/1/12)
The Wall Street Journal : Obama's Corporate Tax Plan "Would Make The U.S. Tax System Less Globally Competitive And Raise Effective Tax Rates Above What They Are Today."
"Yesterday's release of the White House 'Business Tax Reform' marks a watershed in the corporate tax debate. Now nearly everyone acknowledges that U.S. corporate tax rates hurt American companies. The headline that President Obama wants voters to see is his new top statutory rate of 28%. If only the story ended there. Alas, his reform is stuffed with so many offsetting business tax increases that the overall impact of this and other proposals would make the U.S. tax system less globally competitive and raise effective tax rates above what they are today." (Editorial, "Obama's Tax Reform Muddle," The Wall Street Journal, 2/23/12)
WSJ: "The Problem Is That The Tax Increases In This And Other Obama Proposals Would Add New Layers Of Inequity And Inefficiency To The Tax Code." "The problem is that the tax increases in this and other Obama proposals would add new layers of inequity and inefficiency to the tax code. One principle of tax reform is to create neutrality within and across industries-a level playing field. As the White House proposal puts it, the current code 'distorts choices such as where to produce, what to invest in, how to finance a business, and what business form to use.'" (Editorial, "Obama's Tax Reform Muddle," The Wall Street Journal, 2/23/12)
Martin Sullivan Of Tax Analysts: "The Whole Idea Of Corporate Tax Reform Is To Get Rid Of Loopholes, And This Plan Is Adding Loopholes Back In." "Some say such varying rates can distort the economy by diverting investment into some industries and away from others that might pack a bigger economic punch. 'The administration is not making sense,' says Martin Sullivan, contributing editor at publisher Tax Analysts. 'The whole idea of corporate tax reform is to get rid of loopholes, and this plan is adding loopholes back in.'" (Paul Wiseman and Christopher Rugaber, "To Close Tax Loopholes, Obama Would Open New Ones," The Associated Press, 2/23/12)
Most Of The Members Of Obama's Jobs Council Have Refused To Comment On The President's Corporate Tax Proposal. "President Barack Obama's jobs council isn't ready to come out in support of his new corporate tax reform proposal. Instead, most of the 27 business leaders Obama signed up last year for the President's Council on Jobs and Competitiveness have avoided taking a position in the week since the president announced the plan." (Josh Boak, "Jobs Council Mostly Mum On Corporate Tax Plan," Politico, 2/28/12)
15 Out Of 18 Respondents From Obama's Jobs Council Refused To Comment, Including His Campaign Co-Chair Penny Pritzker And Top Donor John Doerr. "POLITICO reached out to all 27 members of the jobs council. Of the 18 who responded, 15 companies - including Facebook, investment firm TIAA-CREF and cable provider Comcast - declined to comment on the plan. Among those who declined to comment were Obama campaign co-chair Penny Pritzker and venture capitalist John Doerr, a fellow top Obama donor. Robert Wolf, president of the UBS investment bank, said he hadn't read the plan yet." (Josh Boak, "Jobs Council Mostly Mum On Corporate Tax Plan," Politico, 2/28/12)
OBAMA'S GLOBAL MINIMUM TAX IS AN ILL-CONCEIVED CAMPAIGN SOUND BITE THAT WOULD HURT AMERICAN COMPANIES ON THE GLOBAL STAGE
Biden Says White House Wants To Create A Global Minimum Tax. BIDEN: "We want to create what's called a global minimum tax, because American taxpayers shouldn't be providing a larger subsidy for investing abroad than investing at home." (Vice President Joe Biden, Remarks, Davenport, IA, 3/28/12)
The Obama Administration Has Proposed A Global Minimum Tax But They Won't Say How High It Will Be. "But then, in the third section, the White House will follow up on an innovative idea they included in the State of the Union and propose a global minimum tax. They'll say more about how such a tax will work, but they won't say how high such a tax should be. That's left up to Congress." (Ezra Klein, "Wonkbook: Tax Reform Is Really, Really Hard," The Washington Post , 2/22/12)
The Global Minimum Tax Means That "Instead Of A Carrot, Corporate America Gets The Stick." "So instead of a carrot, Corporate America gets the stick. Instead of lowering the U.S. rate to a competitive level, Obama would raise the penalty on keeping profits overseas. Indeed, the United States is a huge outlier in that it taxes the foreign profits of multinational companies." (Jim Pethokoukis, "Why Obama's Corporate Tax Plan Is A Total Bust," The American, 2/22/12)
The Global Minimum Tax Would Give Foreign Companies Doing Business In The U.S. A Tax Cut While U.S. Businesses Abroad Would Get A Tax Hike. "Thus the plan would increase taxes on U.S. multinational companies as a means of paying for the lower corporate tax rate which will largely benefit domestic companies. On that note, it seems very unfair that foreign companies doing business in this country would get a 20 percent tax cut but U.S. companies doing business abroad would get a tax increase. How does that help U.S. competitiveness?" (Scott A. Hodge, "Thoughts On President Obama's Corporate Tax Plan," Tax Foundation, 2/23/12)
"The Administration's Proposed Global 'Minimum Tax' Is A Bit Like Neiman Marcus Declaring Itself The Last Stop Against The Growth Of Discount Retailers Such As Target, Walmart And, Now J.C. Penny." (Scott A. Hodge, "Thoughts On President Obama's Corporate Tax Plan," Tax Foundation, 2/23/12)
The Global Minimum Tax Is Opposed By Obama's Jobs Council, Fiscal Commission And The Business Roundtable
Business Roundtable: Obama's Corporate Tax "Framework Would Still Leave The U.S. Combined Corporate Rate 8 Percentage Points Higher Than The Average Of Countries In The Organization For Economic Cooperation And Development." "Despite the President's proposal to cut corporate rates to 28 percent, the framework would still leave the U.S. combined corporate rate 8 percentage points higher than the average of countries in the Organization for Economic Cooperation and Development. The result would keep the United States at a significant disadvantage with its major competitors, Engler said." (Press Release, "BRT: It's Official: President Embraces Lower Corporate Tax Rate But Revenue Neutrality, Competitive Territorial System Missing," Business Roundtable, 2/22/12)
Business Roundtable On Obama's Global Minimum Tax: "No Other Developed Country Imposes Such A 'Minimum Tax' On The Foreign Earnings Of Their Corporations." "The framework described by U.S. Treasury Secretary Tim Geithner today outlines a series of significant tax increases on companies with worldwide operations - most notably a minimum tax on foreign income. No other developed country imposes such a 'minimum tax' on the foreign earnings of their corporations." (Press Release, "BRT: It's Official: President Embraces Lower Corporate Tax Rate But Revenue Neutrality, Competitive Territorial System Missing," Business Roundtable, 2/22/12)
Obama's Own Jobs Council Proposed Moving To A Territorial Tax System "In Order To Make America More Competitive In Global Markets" Rather Than Taxing Foreign Profits. "Many Council members agree that the U.S. should shift to a territorial system of taxation in order to make America more competitive in global markets. While most other developed nations have adopted territorial systems that exempt most or all foreign income from taxes when they are repatriated, the U.S. subjects all worldwide earnings to the corporate income tax when they are brought home to the U.S. This approach actually encourages U.S. companies to keep their earnings abroad rather than investing them here at home. Adopting a territorial tax system would bring us in line with our trading partners and would eliminate the so-called 'lock-out' effect in the current worldwide system of taxation that discourages repatriation and investment of the foreign earnings of American companies in the U.S." ("Reform The Outdated Tax System To Enhance American Competitiveness," The Jobs Council, Accessed 2/22/12)
Obama's Fiscal Commission Recommended A Territorial Corporate Tax System Where Most Or All Foreign Profits Are Not Taxed. "Move to a competitive territorial tax system. To bring the U.S. system more in line with our international trading partners', we recommend changing the way we tax foreign-source income by moving to a territorial system. Under such a system, income earned by foreign subsidiaries and branch operations (e.g., a foreign-owned company with a subsidiary operating in the United States) is exempt from their country's domestic corporate income tax. Therefore, under a territorial system, most or all of the foreign profits are not subject to domestic tax. The taxation of passive foreign-source income would not change." ("Moment Of Truth: The Report Of The National Commission On Fiscal Responsibility And Reform," The National Commission On Fiscal Responsibility And Reform , 12/1/10)
Rather Than Punishing Multinationals, Obama's Fiscal Commission Said That Corporate Tax Reform Should "Help U.S.-Based Multinationals Compete Abroad In Active Foreign Operations." "Make America the best place to start a business and create jobs. The current tax code saps the competitiveness of U.S. companies. Tax reform should make the United States the best place for starting and building businesses. Additionally, the tax code should help U.S.-based multinationals compete abroad in active foreign operations and in acquiring foreign businesses." ("Moment Of Truth: The Report Of The National Commission On Fiscal Responsibility And Reform," The National Commission On Fiscal Responsibility And Reform ,
12/1/10)
No comments:
Post a Comment