WASHINGTON (Reuters) – President Barack Obama, who has angered businesses with his plans to close corporate tax loopholes, is expected to call for cutting the top 35 percent corporate tax rate as early as this month, according to two sources close to the administration.
The president is likely to propose a rate close to an average of peer nations, the sources said.
This would fit with remarks made last year by Treasury Secretary Timothy Geithner, who suggested the United States should be moving to a rate more in line with its major trading partners in the high 20 percent range. Obama outlined tax measures – including closing tax breaks for companies that move facilities and jobs overseas – in his State of the Union speech in January, and is expected to lay out principles for revamping corporate taxes as soon as this month.
Facing a potentially tough presidential re-election challenge this November, Obama will propose cutting the rate in the days after he releases his 2013 budget plan on Monday, February 13, according to the sources, who were not authorized to speak on the record.
While he spent a big part of his January speech to Congress criticizing businesses for moving jobs overseas, Obama said that “companies that choose to stay in America get hit with one of the highest tax rates in the world.”…
You might notice (or not) that the article is talking about two different sorts of companies: those that operate internationally and those that stay home. Is Obama only talking about lowering the tax rate for those companies that operate domestically? If so, why quote the Timmeh regarding the rates of peer nations and trading partners, which would be irrelevant otherwise? It’s a puzzler. It is supposed to be a puzzler right up until the time when “the plan” is released, Congress rushes it through, it becomes law, and the public finally gets to read the thing, whereupon it is discovered that any tax cuts will go to the multinational corporations and no loopholes have been closed. It will be shocking, I tell you, unless you have the crystal ball to help you decipher what in the bloody hell these people are up to. We are, after all, talking about the administration that managed to get three new free-trade agreements passed, give 14.7 trillion dollars to the big banks in secret bail-outs, and pass a health-care law that resulted in rate increases out the butt for everyone and more uninsured Americans than before the thing was written.
Closing loopholes? “Odds are not good,” according to my crystal ball. Lowering corporate tax rates on corporations that already pay zero to three per cent effective rate? “Outlook sunny,” says my crystal ball.
Now for small businesses that stay in the US and actually create jobs and pay their taxes, the opposite of the above predictions are true. According to my crystal ball.
Getting the largest US corporations to bring their money and jobs back to the US? “HA, HA, HA, HA – you must be fucking retarded,” says the crystal ball.