Over the weekend the six month-old RATE Coalition--RATE stands for Reforming America's Taxes Equitably--began its 35 day countdown to draw attention to the day when the United States has the highest corporate tax rate of the industrialized nations. That's when Japan's new corporate tax rate takes effect. April 1 is that date--which is no joke.
As of this writing we are at 32 days, as you can see on the cleverly-designed widget the organization has designed.
Yesterday afternoon RATE held a bloggers' conference call hosted by its co-chairs, Elaine Kamarck, a former Bill Clinton White House staffer, and Jim Pinkerton, who worked in the White House in the Ronald Reagan and the George H.W. Bush administrations. Pinkerton is probably best known for his weekly appearance on Fox News Watch.
Pinkerton mentioned that while President Obama is proposing a lower rate--a top one of 28 percent, he's "not terribly happy about it." He added that the Republicans are "solidifying" around a 25 percent rate, which is the GOP congressional position and what Mitt Romney supports.
The Republican proposal for a lower corporate tax rate includes simplifying the tax code--which will eliminate many loopholes.
It's an old adage--and an accurate one--that it's difficult to pass meaningful legislation in an election year. But Kamarck told us "that we actually hope that there can be some action before the election."
In the email preview about the call, RATE listed some of its members, one that is dominated by major corporations--which I viewed as potentially troubling. For instance, in a September media conference call, US Rep. Adam Kinzinger (R-IL), decried the current tax code that favors large corporations. They can afford the accountants and tax attorneys to find loopholes that cut cut their taxes--small firms usually don't have the resources to do so as well. 'What about them?' I asked during the question and answer session.
Kamarck's reply centered on the dilemma I brought up. She explained that our current tax rates "also distort business decision-making for the big guys and they weight the field against the little guy." With a simplified tax code, the corporate giants can center their efforts on their products and their customers--and smaller firms won't be burdened by having to pay higher taxes than their larger competitors.
Pinkerton concurred, calling their proposal "A corporate version of the 1986 Tax Reform Act," which greatly simplified individual taxes.
Lowering the corporate tax rate--and simplifying it--is a sound idea.
Related post:
Rep. Adam Kinzinger responds to Obama's jobs speech in conference call
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