Washington, D.C. – Today Michael Ettlinger, Vice President for Economic Policy at the Center for American Progress, released the following statement in reaction to the Obama administration’s proposal to overhaul the corporate tax code:
The White House has laid out a roadmap for corporate tax reform that is aimed exactly where it should be: on strengthening the U.S. economy for the benefit of the nation as a whole. It is a serious first step toward overhauling the corporate tax code in a way that enhances growth and job creation in the United States. It addresses problems that corporations have legitimately complained of while making its primary focus our most important national challenges, including strengthening the middle class and improving our long-term fiscal outlook. While still more revenue is needed for deficit reduction, the $250 billion that the administration proposes in its corporate reform that would fund measures that have previously been extended without being paid for, such as the research tax credit, is a welcome start.
Our existing corporate tax code is a mess. It rewards companies for moving investments offshore, for taking on excessive debt, and for hiring armies of lawyers and accountants to game it. The White House is proposing a substantial improvement: A tax code that actually rewards companies for investing and hiring in the United States. While eliminating dozens of loopholes, the proposal reorients the incentives embedded in the tax code toward domestic investment, specifically on the investments in R&D, manufacturing, and new energy technologies that drive economic growth.
Economists generally agree that the best way to make the tax system more conducive to growth is to broaden the base and lower the rate. That’s exactly what the president is proposing to do. And he’s doing so in a way that is fiscally responsible. Under this proposal, the corporate sector will be asked to contribute to deficit reduction. That’s critically important so that we don’t add to the debt or shift more of the tax burden onto the middle class.
To speak with an expert from CAP, contact Katie Peters at firstname.lastname@example.org or 202.741.6286.
Related resources from the Center for American Progress: