Powerful Ways and Means Committee chairman proposes 3 percent cut in corporate tax rate, as America unbelievably taxes corporations higher than most industrialized nations.
WASHINGTON – Today, House Ways and Means Committee chairman Bill Thomas (R-Calif.) proposed a bill that would cut taxes on businesses and corporations by 3%. The plan comes as part of a larger package to repeal provisions of corporate taxation that were deemed illegal in a recent ruling by the World Trade Organization (WTO).
The bill will cut the corporate tax rate by 3 percent for companies that fall below a $10 million annual income threshold. It also allows a faster depreciation for equipment purchases – from 7 to 10 years – which will only be available to manufacturers. It allows repatriation, and will keep the tax code for penalizing companies for investing inside American borders, and, importantly, will put America in compliance with the WTO to ensure that a worldwide trade war does not begin. The entire package will save businesses $175-190 billion over ten years.
"America was built on trade and enterprise, yet, according to the Organization for Economic Cooperation and Development (OECD) we tax our businesses at higher rates than most OECD countries," said taxpayer advocate Grover Norquist, who heads Americans for Tax Reform (ATR) in Washington, D.C. "Thomas\’s bill is both tax relief and reform."
The bill will also permit companies to bring income earned overseas into the United States under a reduced tax rate, and seeks to extend the research and development tax credit. The bill has strong support in the U.S. Senate as well, as Senate Judiciary Committee chairman Orrin Hatch (R-Utah) is expected to join Thomas in promotion of the bill. Hatch wants to permanently extend the R&D provision.
"Tax revenues grow when the economy grows, and the economy grows when jobs abound, and jobs abound when businesses thrive, and businesses thrive when a more competitive environment exists, and competitive environments exist when taxes and regulations are low," continued Norquist. "Thomas\’s plan creates a more competitive climate for American businesses that do business both here and overseas, which is when American tax policy is at its best."