Obama Pushes to Overhaul Silly, Counterproductive U.S. Corporate Tax System
The president's proposed tax hikes got all the press, but in an opening bid to Republicans, he also offered to cut the corporate tax rate to 28%.
President Obama proposed a big tax hike on American companies. At least in part, Obama's tax plan might actually be good for them.
Obama's proposed tax increases have received a lot of attention in the financial media, but along with the stick, his annual budget submission to Congress contained a big carrot. True, Obama did call for a 14% tax on overseas profits that U.S. companies have not yet repatriated, plus a 19% tax rate on all future overseas income, with a credit for taxes paid overseas. (Obama would use the increased revenue to help pay for greater infrastructure spending.) But the president also included a call to cut the headline corporate tax rate to 28% from 35%. The current statutory U.S. tax rate is the highest in the industrialized world.
Scott Cooley does not own shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.