Business Leaders Say President’s Corporate Tax Reform Framework Doesn't Go Far Enough
Washington, DC -- Business leaders made the following statements today about the corporate tax reform framework released by the White House:
Scott Klinger, tax policy director of Business for Shared Prosperity, said, "President Obama's outline draws attention to some very important themes, including closing corporate tax loopholes and curtailing the abuse of offshore tax havens, but the devil is in the details. Until the President proposes a rate for his global minimum tax, we remain concerned that this positive idea could be turned into a permanent repatriation tax holiday for tax-avoiding corporations. Moreover, the tax framework places too much emphasis on lowering the corporate tax rate and not enough on raising corporate tax collections from their historically low level. U.S. corporations pay far less toward the cost of public services and infrastructure than they did in decades past and less than their foreign competitors pay in their countries today.
Mr. Klinger added, "The reality is that large U.S. businesses, as a whole, are undertaxed, not overtaxed. In 2011, total corporate federal taxes fell to just 12.1% of domestic profits and corporate taxes accounted for just 7.9% of all federal revenue. Moreover, as a percentage of U.S. Gross Domestic Product, the corporate tax share was just 1.2%. All these levels are historically, irresponsibly low.”
Frank Knapp, Jr, president and CEO of the South Carolina Small Business Chamber of Commerce and vice chair of the American Sustainable Business Council, said, "Small businesses are tired of big businesses not paying their fair share. The President's proposal puts the cart before the horse. Rather than starting with a lower corporate tax rate of 28% -- and even lower for manufacturers -- we should start by establishing a fair and responsible share of corporate taxes as a percent of our economy that is competitive with our major trading partners, and achieve that through a combination of closing loopholes and adjusting tax rates where warranted. Then we can meet three important objectives: ending loopholes and breaks that reward large U.S. corporations for disguising their domestic profits as “foreign” earnings and shifting investment and jobs overseas; leveling the playing field among big and small businesses; and raising the revenues we need for the modern infrastructure, education, research and other public investments that underpin an innovative, healthy, job creating economy."
Mitch Rofsky, president of the Better World Club and board member of the American Sustainable Business Council, said, “Corporate tax loopholes need to be closed, but this alone will not assure that large profitable corporations are paying their share. We need a strong Buffett rule for corporations. Then, no longer would the GEs and the Exxons be able to escape paying corporate taxes entirely.”
The American Sustainable Business Council is a growing coalition of business networks representing over 100,000 companies and 200,000 business leaders. ASBC advocates for public policies that meet the realities of the 21st century global economy.
Business for Shared Prosperity is a national network of forward-thinking business owners, executives and investors. BSP is a member of the American Sustainable Business Council. www.businessforsharedprosperity.org