Rep. Emmer's "CREATE Jobs Act" Will Fix America's Competitiveness Problem
Congressman Tom Emmer (R-MN) recently introduced H.R. 533, the Corporate Rate Equality and Trade Empowerment (CREATE) Jobs Act. This innovative legislation lowers the corporate tax rate to a globally competitive level so American businesses are able to compete in the global economy. ATR urges all members of Congress to support and co-sponsor Rep. Emmer’s bill.
America’s corporate income tax rate is close to 15 percent higher than the average in the developed world. The tax rate has barely changed since tax reform was passed 30 years ago in 1986. At the time, we lowered our rate to 39 percent – below the developed average of 44 percent. Since then, other countries have cut their rates aggressively.
32 of the 35 developed countries have reduced their corporate rates since 2000. Only the U.S. and Chile have higher corporate tax rates than they did in 2000. Our high rate makes it difficult, if not impossible for our businesses to compete with competitors that have much lower rates Canada (26.3 percent), the United Kingdom (20 percent), and Ireland (12.5 percent).
The CREATE Jobs act would address this inequity by reducing the U.S. corporate rate to five points below the OECD average and creating a process by which the U.S. rate is regularly reviewed to ensure economic competitiveness.
The current high U.S. rate not only hurts American competitiveness, it has real world implications for the economy. The high rate has resulted in close to 50 American businesses leaving the country through an inversion in the past decade, according to data compiled by Democrats on the Ways and Means Committee. The uncompetitive code has also resulted in a net loss of more than $700 billion in assets that have been acquired by foreign competitors according to a report by Ernst and Young.
By creating a system that creates a competitive corporate tax rate, Rep. Emmer’s CREATE Jobs Act ensures that the U.S. again becomes a leader in the global economy and it stays there. Members of Congress should support and pass H.R. 533 to help provide a much needed booster shot to the economy.
The letter can be read here.