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Will House Republicans push a corporate tax overhaul?

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The White House has lately been voicing support for lowering the corporate tax rate. A Republican takeover of the House would give the idea even more traction, with Rep. Dave Camp of Michigan in line to chair the tax-writing House Ways and Means Committee.

Camp is a staunch supporter of overhauling the corporate tax code, as seen in this Feb 7, 2008, press release from his office.

"For the U.S. economy to truly grow, be competitive, and create jobs, Congress needs to examine the tax code's deep, fundamental flaws," said Camp, a senior member of the committee. "By making the 2001 and 2003 tax cuts permanent and reducing the corporate tax rate to, for example, the OECD average rate of 31 percent, the United States can compete for jobs in this increasingly shrinking world of commerce."

Camp noted in the release that, in 1960, America was home to 18 of the world's 20 largest corporations, yet three decades later that number had shrunk to eight.

"We know why," Camp continued. "Virtually every other industrialized nation has reduced tax rates leaving us with the second highest corporate tax rate. It's been 20 long years since Congress successfully embarked on a comprehensive plan to lower people's tax rates. It's time we streamline the code, make it simpler for taxpayers to comply with, and lower the tax burden on families and business owners."

The administration wants to pay for a lower rate by paring back various industry tax breaks. No word yet on how Camp would cover the cost, but the way he ties the issue to making U.S. companies more competitive is music to the ears of corporate lobbyists who have been fending off Democrat-proposed tax hikes for months.

By Jia Lynn Yang  | November 1, 2010; 1:02 PM ET
Categories:  2010 Elections, Corporate taxes  
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Comments

Sure, the on-the-books rate is higher than the OECD average, but the amount actually COLLECTED is much lower than the OECD average. Mostly because of loopholes benefiting those 8 big companies.

http://voices.washingtonpost.com/ezra-klein/2010/09/our_dumb_corporate_tax_system.html

Fix the loopholes!

Posted by: Anonymous | November 1, 2010 1:37 PM | Report abuse

How about we eliminate the corporate income tax altogether, rather than perpetuate it as a political football. The right uses it as a bludgeon against those they accuse of as antibusiness. The left thinks that "corporate" persons are real and that this tax is a way to make the rich pay a fair share.

Eliminate it altogether and institute new tax mechanisms in their place - that make more economic sense. Tax any corporate profits that shareholders receive in the form of dividends at that person's individual rate. If corporations retain earnings and plow it back into their operations (investment, R&D, etc), then that would escape taxation altogether.

It would eliminate double-taxation (that happens first at the corporate level and then at the individual level on already taxed dividends).

It would increase revenues because the individual tax rate is largely higher than the corporate rate (more so as more dividends end up with high income investors).

It would create real incentives for corporations to renew themselves into economically more productive enterprises.

What's not to like? I also know that we won't be hearing any thoughtful debate on this in Congress - see my first paragraph.

Posted by: audritsh | November 1, 2010 2:06 PM | Report abuse

Corporate Taxes should be lowered to 25% with a mandatory 15% after all write-offs. The corporate tax rate of 35% is a Joke when loopholes allow companies to write off 100% of their taxes and force small business and individuals to bear the greatest blunt of America’s tax burden. America needs a minimum tax rate of 15% for all businesses and individuals after all deductions.

http://www.forbes.com/2010/04/01/ge-exxon-walmart-business-washington-corporate-taxes_slide.html?partner=abcnews

“It's the tax benefit of overseas operations that is the biggest reason why multinationals end up with lower tax rates than the rest of us. It only makes sense that multinationals "put costs in high-tax countries and profits in low-tax countries," says Scott Hodge, president of the Tax Foundation.”

Posted by: Anonymous | November 1, 2010 2:42 PM | Report abuse

Dave Camp conveniently omits the reason that other western nations have lower corporate tax rates: a VAT or national sales tax is imposed. The Republican plan is shift the burden of taxation to consumption--and individuals and families will be paying more while corporations pay less.

Posted by: Anonymous | November 1, 2010 2:45 PM | Report abuse

Now I'm signed in; Corporate and Individual Taxes should be lowered to 25% with a mandatory 15% after all write-offs.

Politicians must stop their attacks on social security with plans to harm the elderly, by raising the age and reducing the benefits, instead of having the Rich contribute more. Benefits for the elderly should not be reduced in any way to protect the incomes of the wealthy. Social security benefits should be increased and all income, not just the first $107k, modestly taxed to support it. Tax all income, but lower everyones tax from current 6.2% to 4%.

Raise the Social Security Tax to include all income and not just up to your first $107k. As more people have gotten wealthy, wealth has been shielded from the Social Security Tax as it has not kept up with inflation.

http://politics.usnews.com/opinion/articles/2010/09/20/cutting-benefits-isnt-the-way-to-save-social-security.html

“Cutting Benefits Isn't the Way to Save Social Security: The answer isn't raising the retirement age; it's making the rich pay a fair share”

“Most people don't know that someone making $300,000 or even $30 million a year pays no more in Social Security taxes than someone earning roughly $107,000. In 1983, 90 percent of wage and salary income was taxed, but today it's less than 84 percent. That's a huge windfall for the rich and a serious shortfall for Social Security.”

Posted by: Airborne82 | November 1, 2010 2:51 PM | Report abuse

For the U.S. economy to truly grow, be competitive, and create jobs,what we actually need to do is reduce our salaries to 60% of what we presently make, and then reduce our interagency agreements to 20% of our present amounts in order to complete with the countries which offer the same, for less - through unpaid overtime. And only then will we be able to truly grow. That is, unless we have one hell of a war instead! But hey, if you think that a 14% tax break is really all it takes, then it looks like it's war. Your choice.

Posted by: Anonymous | November 1, 2010 4:03 PM | Report abuse

If corporations can give money to political campaigns like individuals, they should pay taxes like individuals. Shouldn't they help pay for services they use? They want it both ways.

Posted by: jckdoors | November 1, 2010 4:04 PM | Report abuse

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