The current U.S. economic recovery is arguably the worst in modern American history. Incomes are flat, housing is moribund, and the past three years have seen the longest stretch of high unemployment in this country since the Great Depression. Yet President Barack Obamaâ€”with the backing of Treasury Secretary Timothy Geithnerâ€”has the temerity to propose a corporate tax reform plan that would actually raise the tax burden on American business (and de facto on workers, too) without lowering rates to an internationally competitive level. This is a terrible, terrible plan:
..The Obama-Geithner plan would lower the statutory corporate tax rate to 28 percent from 35 percent, currently the second-highest among advanced economies. But that would still leave the combined U.S. corporate tax rateâ€”state and federalâ€”at 32.2 percent, far above the OECD combined average of 25 percent. The U.S. combined rate would be a bit below slow-growing Japan and France but above the U.K. and Germany. Thatâ€™s not nearly good enough. Canada just lowered its corporate tax rate, for instance, to 15 percent. So instead of having the second highest corporate tax rate in the world, the United States would probably be fourth behind Japan, France, and Belgium.
22 Feb 2012