The New White House Budget and Corporate Taxes
February 14, 2011
The White House released the President’s proposed budget for FY 2012 today, and it included some significant corporate tax changes. Tax Foundation President Scott Hodge gave his initial reaction to the new provisions:
Despite his promises to make the U.S. a more attractive place to business in and do business from, President Obama is proposing $129 billion in tax increases on American firms doing business abroad. Not only will these tax hikes make U.S. businesses less competitive, but they would threaten jobs back home as well.
It is disappointing that the President chose not to take a leadership role in making the corporate tax system more competitive, especially with Japan expected to cut their corporate tax rate in April, which will leave the U.S. with the highest overall corporate tax rate among developed nations. Canada has already cut its corporate tax rate this year and the United Kingdom is scheduled to cut its corporate rate in April. To be competitive globally, America needs lower corporate taxes, not higher taxes.
For more background on the issue, see Tax Foundation Special Report No. 184, “Putting Corporate Tax ‘Loopholes’ in Perspective.”