Obama To Pitch Lower Corporate Tax Rate Sometime In The Future
While Obama’s budget, which he plans to announce on Monday during what will be a campaign rally, significantly ramps up tax rates for small business owners, he’s looking to pander to corporations
(Reuters) President Barack Obama will 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 closer to an average of that seen in peer nations, the sources said.
That would put the rate at about 20%. But, why not announce it now? Because this isn’t about passing a corporate tax rate cut, but, about politics
Facing a potentially tough presidential re-election challenge this November, Obama will propose cutting the rate following the release of 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.”
If he does announce a plan, the details will probably end up helping just a few companies, probably ones led by people who vote Democrat and donate to Democrats, much like with Obama’s Stimulus. And much like Obama’s vaunted bank settlement, which seems to help the big bank owners.
An overhaul of the corporate tax system is extremely unlikely in an election year, but the president’s proposal could be an olive branch to the business community to show that he agrees with them on one key aspect of tax reform.
And there you go, this is about campaign optics, not about actually Doing Something. He’ll probably offer up something which looks great on the outside, but has poison pills on the inside, which are objectionable to the GOP. The media will avoid mention of the poison pills, and make the GOP look bad. If the GOP has any brains, they should pass a clean corporate tax rate quickly, forcing Obama’s hand. They should do the same with the payroll tax cut, extending it for one year, get ahead of the curve. Obama whined about this in this week’s weakly address (yes, I meant to spell it that way). Obama plans to offer the cut in his budget. Now we know why Democrats wanted a 2 month extension: to attempt to make Obama look magnanimous by pushing a year long extension, which is what Republicans wanted in the first place.