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Thu Dec 13, 2012, 03:19 PM

WTF - Obama going along with Corporate Tax Reform

The Wall Street Journal has news of some actual developments in the ongoing fiscal cliff negotiations: this morning, it reported that President Obama will add corporate tax reform to his offer to House Republicans, in an effort to bring them along and invite a buy-in from the pesky CEOs crowding up the airwaves during most of this saga.

The Journal says “The White House’s corporate-tax suggestion wasn’t specific” but that “White House officials, in making the suggestion, cited a corporate-tax plan the administration unveiled in February.” The plan the White House outlined earlier this year, if you don’t recall, was to lower the corporate tax rate from 35 percent to 28 percent while closing corporate tax loopholes to a degree that enough revenue is raised to offset the rate reduction.

So you can immediately see the first problem with Obama’s proposal—since it’s revenue-neutral, it asks corporate America to contribute nothing to a final deficit reduction passage.
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Worse, his plan would quite likely give the corporations an even lower final tax bill once it’s implemented—or rather, not implemented. Obama’s corporate tax plan suffers from the same problems as Romney’s income tax plan: it lowers rates, which is immediate and likely permanent, but doesn’t actually specify enough loopholes to make up the revenue.

http://www.thenation.com/blog/171728/emerging-fiscal-cliff-deal-spares-corporations-not-safety-net?rel=emailNation#

23 replies, 1808 views

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Arrow 23 replies Author Time Post
Reply WTF - Obama going along with Corporate Tax Reform (Original post)
Smilo Dec 2012 OP
blkmusclmachine Dec 2012 #1
MotherPetrie Dec 2012 #2
plethoro Dec 2012 #14
SoapBox Dec 2012 #16
djean111 Dec 2012 #3
Myrina Dec 2012 #6
cui bono Dec 2012 #7
RoccoR5955 Dec 2012 #10
AnotherMcIntosh Dec 2012 #13
Dawgs Dec 2012 #4
indepat Dec 2012 #5
GeorgeGist Dec 2012 #8
Filibuster Harry Dec 2012 #9
NewJeffCT Dec 2012 #11
budkin Dec 2012 #12
LynneSin Dec 2012 #15
midnight Dec 2012 #17
Swede Atlanta Dec 2012 #18
Ikonoklast Dec 2012 #20
quakerboy Dec 2012 #19
PoliticalBiker Dec 2012 #21
Jack Sprat Dec 2012 #22
Avalux Dec 2012 #23

Response to Smilo (Original post)

Thu Dec 13, 2012, 03:25 PM

1. Forward!

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Response to Smilo (Original post)

Thu Dec 13, 2012, 03:26 PM

2. Just as if there had never been an election

 

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Response to MotherPetrie (Reply #2)

Thu Dec 13, 2012, 05:59 PM

14. Exactly. I would have bet anything that this would happen........nft

 

dddddd

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Response to MotherPetrie (Reply #2)

Thu Dec 13, 2012, 06:03 PM

16. Ditto.

How quickly we are forgotten.


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Response to Smilo (Original post)

Thu Dec 13, 2012, 03:26 PM

3. I can't believe this surprises you enough to say "WTF". n/t

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Response to djean111 (Reply #3)

Thu Dec 13, 2012, 03:42 PM

6. Right?

<shakes head> The guy is NOT a progressive liberal. Just ... never was, never will be.
Not sure why people around here still refuse to see that, despite all evidence.

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Response to Myrina (Reply #6)

Thu Dec 13, 2012, 03:48 PM

7. +1,000,000,000

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Response to Myrina (Reply #6)

Thu Dec 13, 2012, 04:13 PM

10. +1^100 n/t

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Response to Myrina (Reply #6)

Thu Dec 13, 2012, 04:25 PM

13. "Not sure why people around here still refuse to see that". Maybe some who refuse to see that

 

and call Democrats "purists" are Republicans or Republican-wannabes.

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Response to Smilo (Original post)

Thu Dec 13, 2012, 03:31 PM

4. The lesser of two evils strikes again. Hope he backs off this one as well. n/t

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Response to Smilo (Original post)

Thu Dec 13, 2012, 03:35 PM

5. Corporations, paying an effective income tax rate of 7%, are not part of the

deficit problem. Yeah! This is pure de male bovine excrement and, like ERISA, every thing rotten invented since Adam.

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Response to Smilo (Original post)

Thu Dec 13, 2012, 03:52 PM

8. Corporate Profit Share of GDP Reaches All-Time High Despite Sharia Socialism

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Response to Smilo (Original post)

Thu Dec 13, 2012, 04:00 PM

9. Corporations haven't paid income taxes in years. Dropping the rate is fine while eliminating

tax loopholes. I think the president wants to reduce the corporate tax on manufacturing to 25% or even lower in order to entice more manufacturing in the US.

What I don't understand is this. There are 24 different provisions that ARE NOT available in 2012 unless Congress does something. For instance, the AMT fix or the $ 250 deduction for certain expenses of teachers or better yet the IRA distribution option of having it go directly to a charity so the IRA distribution is not taxable. Why can't some of these provisions be agreed and settled on without being part of a big package?

In addition, there are 27 provisions that are about to expire (the fiscal cliff as they say) that won't be available in 2013.

What are the odds that these are taking care of before 12/31/12??

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Response to Smilo (Original post)

Thu Dec 13, 2012, 04:14 PM

11. Most big corporations don't pay income taxes, and many get refunds.

so, they'll be more hurt by the closing of the loopholes.

It will actually help small to mid-size companies to have a lower corporate rate, since they don't have an army of accountants and tax lawyers at their disposal like GE, Wal-Mart, Exxon, etc.

If they can find enough revenue from loophole-closing, I'd support lowering the corporate tax rate. That's a big "if" however.


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Response to Smilo (Original post)

Thu Dec 13, 2012, 04:20 PM

12. I'm expecting to hear that all the Bush tax cuts are being made permanent

Because "I won't let taxes on the middle class go up."

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Response to Smilo (Original post)

Thu Dec 13, 2012, 06:00 PM

15. I have no problem with Corporate Tax cuts....

provided that they are tied in with hiring more Americans (no H1B Visas) and making sure people have healthcare.

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Response to Smilo (Original post)

Thu Dec 13, 2012, 06:12 PM

17. Spare the safety net, not the corporations.....

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Response to Smilo (Original post)

Thu Dec 13, 2012, 06:18 PM

18. The U.S. has one of the highest marginal tax rates for businesses....

among the major global economies. Most European countries tax between 30 and 34% whereas the U.S. marginal rate, on average is 39%.

The problem is I don't know what the effective tax rates are in these other countries. When you add in all the deductions for business expenses and other "special" allowances, including the corporate welfare (e.g. oil companies), I wonder if the effective U.S. rate is even 20%.

So I'm not opposed to dropping the marginal tax rate on businesses to be competitive but the effective tax rate MUST GO UP. Businesses get so many advantages by operating in our economy and seem to not want to pay anything for those benefits. It is as if we should give them money for doing business here.

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Response to Swede Atlanta (Reply #18)

Thu Dec 13, 2012, 06:40 PM

20. My understanding is the effective rate is 24%.

If the loopholes go away, the effective rate will rise.

This is not a totally bad plan.

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Response to Smilo (Original post)

Thu Dec 13, 2012, 06:27 PM

19. They are not paying anyway

Honestly, why do we even need a corporate tax rate? Lets just tax the money as it goes from corporations to people instead.

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Response to Smilo (Original post)

Thu Dec 13, 2012, 06:45 PM

21. As long as it's eliminating...

... the tax breaks for taking jobs and manufacturing out of our country.
Maybe adding penalties for not moving them back would be ok too.
Stopping corporate welfare... eliminating subsidies to corporations and companies that don't need them anyway.... AMpec, corporate farmers, etc.
Those are reforms I could deal with...

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Response to Smilo (Original post)

Thu Dec 13, 2012, 08:28 PM

22. No surprises at all.

 

Watch the latest Hartmann video w/Bruce Bartlett. Even a former Reagan staffer knows Obama is a centrist Republican from a historical presidential viewpoint. There truly is no "left politics". The labor movement has been mostly castrated. The former left is mostly mods, the former right has gone to the looney right. By historical comparisons, former president Teddy Roosevelt (R) would now be called a communist.

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Response to Smilo (Original post)

Thu Dec 13, 2012, 08:34 PM

23. Republicans won't accept ANY offer from Obama, so it doesn't even matter. Read this too:

One of President Barack Obama's Senate allies said Thursday the White House has assured him the president won't yield to GOP demands to increase the eligibility age for Medicare.

Obama's fellow Illinois Democrat, Sen. Dick Durbin, told reporters that increasing the Medicare age is "no longer one of the items being considered by the White House."

At a news conference, Reid again called on House Republicans to allow a vote on renewing Bush-era tax cuts for the 98 percent of taxpayers whose incomes are below $250,000. Obama vows to force rates on family income exceeding $250,000 from a top rate of 35 percent to the Clinton-era rate of 39.6 percent. He said the alternative is to allow tax cuts for everyone to expire.

On Thursday, Sen. Jim DeMint, a South Carolina Republican and leading conservative figure, predicted that Obama would prevail in the fight over taxes.

http://www.oregonlive.com/politics/index.ssf/2012/12/fiscal_cliff_president_obama_w_1.html

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