Momentum Grows for Comprehensive Tax Reform

With momentum picking up for comprehensive tax reform that includes reducing the corporate rate, the RATE Coalition has been active reaching out to lawmakers and administration officials about the need to make the United States more competitive.  The coalition is slated to release a study that argues the U.S. economy will shrink in the coming years unless corporate rates are cut in a way that is more aligned with tax laws in other countries

In the past weeks, 21 RATE Coalition member chief executive officers wrote a letter to the Chairmen and Ranking Members of the House Committee on Ways and Means and the Senate Finance Committee calling for comprehensive tax reform this year, noting that America’s international competitors have aggressively lowered their rates, leaving us at a disadvantage and citing the one-year anniversary of the United States having the world’s highest corporate tax rate.

They have highlighted the need for the reform, the bipartisan support for the reform, as well as the momentum for reform – challenging the critics and skeptics who claim it can’t be done. The letter showed that over the past 25 years, the U.S. tax code has become increasingly complex while other nations have taken aggressive steps to lower their rates and simplify their tax codes.

Additionally, the letter came on the heels of the rollout of an Ernst & Young study, Macroeconomic Effects of Lower Corporate Income Tax Rates Recently Enacted Abroad, which also included a discussion between Coalition company Tax VPs and a Capitol Hill panel discussion with remarks from Congressmen Richard Neal, John Larson and Peter Roskam, as well as a separate gathering between the Tax VPs and reporters.

Lawmakers are noticing. Media and employees in their home districts are highlighting the cause and its momentum, and have been highlighting the benefits of comprehensive tax reform. An Op-Ed by Chairmen Max Baucus and Dave Camp in this weekend’s Wall Street Journal where they say they are currently writing tax reform bills that aim to “make our companies more competitive,” is further evidence of the growing support and determination by political leaders in both parties to accomplish comprehensive reform.

Recent Articles Resulting from the Letter and Anniversary:

Tax Reform Is Very Much Alive and Doable

Wall Street Journal, Max Baucus and Dave Camp

04/07/13

Every week Congress has been in session for the past two years, one of us has made the short walk across the Capitol to the other’s office. We crowd into a room with our policy experts to chart a path to our mutual goal—comprehensive tax reform.

While we are from different political parties, we agree that America‘s tax code is broken. That is why we have been working together as the chairmen of Congress’s two-tax writing committees to make it fairer for families and spark a more prosperous economy.

CEOs to Congress: Time to Cut Corporate Tax Rate

Wall Street Journal, John McKinnon

04/01/13

A group of big retailers, transportation companies and other businesses released a letter to lawmakers on Monday marking the anniversary of what they regard as a dubious achievement: The U.S. corporate tax rate became the developed world’s highest one year ago, after Japan lowered its rate.

Corporations: America’s had top corporate tax rate for one year

The Hill, Bernie Becker

04/01/13

A corporate coalition is using a new anniversary to lobby lawmakers over the need for tax reform.

FedEx Joins Boeing With CVS In Renewed Tax Rate Cut Pitch

Bloomberg, Richard Rubin

04/01/13

Top executives from 18 large U.S. companies, including FedEx Corp. (FDX), CVS Caremark Corp. (CVS) and Boeing Co. (BA), are trying to keep up pressure on Congress to cut corporate tax rates.

An Unhappy Anniversary

Politico Pro, Lauren French

04/01/13

It has been one year since Japan lowered its corporate tax rate, consequently giving the United States the distinction of have the highest rate in the OCED. Lowering that rate is a huge policy goal for Congress as part of comprehensive tax reform — Republicans especially lament that the rate is a competition killer for U.S. businesses. Morning Tax asked Elaine Kamarck, the co-chairwoman of RATE, how the rate has affected corporations’ tax and investments strategies:

RATE ‘Stands Ready’ for Push on Corporate Rates

Politico Pro, Lauren French

04/01/13

The coalition will send a letter to House Ways and Means Chairman Dave Camp and Senate Finance Chairman Max Baucus today bemoaning America’s last-place finish in corporate tax rates. The signers, including CEOs for AT&T Inc, FedEx and Boeing, say they “stand ready” to support Congress in making a lower corporate tax rate “a reality.” “It has been one year since Japan lowered its corporate tax rate, leaving the U.S. atop the industrialized world as the country with the highest statutory corporate rate. Coupled with our complicated tax system, this rate makes American businesses less competitive and makes the U.S. a less attractive place for investment, ultimately harming businesses, investors, workers and consumers,” the letter reads.http://politico.pro/10rzoX4

K Street Files: CEOs Lobby for Tax Reform

Roll Call, Kate Ackley

04/01/13

Twenty-one CEOs of some of the country’s biggest companies had a message Monday for members of Congress. They want comprehensive tax reform, and that’s no April Fools’ joke.

FedEx joins call for lower corporate taxes

Memphis Business Journal, Andy Ashby

04/01/13

FedEx Corp.  is part of the corporate chorus asking Congress for some tax relief.

The Memphis-based shipping giant is one of 18 large American companies asking for cuts to corporate tax rates, according to Bloomberg.com.

Corporate chiefs turn up pressure for tax reform

Market Watch, Robert Schroeder

04/01/13

Chief executives of big U.S. corporations including AT&T Inc. and FedEx Corp. are urging lawmakers to quickly enact comprehensive tax reform – especially where it will benefit their own companies, in the form of a lower corporate tax rate.

CVS, others pressure Congress to cut corporate tax rates

Providence Journal

04/01/13

Woonsocket-based CVS Caremark Corp. and 17 other U.S. corporations are trying to keep up pressure on Congress to cut corporate tax rates.

CEO Coalition Calls for Lowering Corporate Tax Rate

WWD, Kristi Ellis

04/01/13

A coalition of chief executive officers from 21 companies, including Macy’s Inc. and Gap Inc., sent a letter to the leaders of the two tax writing committees in the House and Senate, reiterating their call for corporate tax reform and a lower corporate tax rate.

Macy’s CEO among execs calling for tax reform

Cincinnati.com, Bowdeya Tweh

04/02/13

The head of Macy’s Inc. is among company executives and business group leaders urging lawmakers to

lower the nation’s corporate tax rate as part of comprehensive tax reform.

FedEx joins Boeing, CVS in renewed tax rate cut pitch

Washington Business Journal

04/02/13

Executives from 18 of the largest companies in the U.S. — including FedEx Corp., CVS Caremark Corp. and The Boeing Co. — are keeping the pressure on Congress to cut corporate tax rates by sending a letter to congressional leaders Monday urging action, Bloomberg reported.

Macy’s Lundgren among CEOs asking Congress to cut corporate tax rate

Business Courier, Tom Demeropolis

04/02/13

Terry Lundgren, CEO of Macy’s Inc. was one of 21 chief executives who sent a letter to Congress calling for comprehensive reform of America’s tax code.

A year ago, Japan cut its corporate tax rate, making the U.S the nation with the highest corporate tax rate at 35 percent.

High Corporate Taxes Are No Way to Do Business

U.S. News and World Report, Peter Roff

04/02/13

America‘s current economic recovery continues to lag behind all those that have come before it in the post-war era, mostly because of the continuing mess in Washington. Higher taxes, more government regulation of the business sector, crony capitalism, and reckless spending do not point the way to the solution – yet that is all the Obama Administration seems willing to offer.

RATE Coalition Statement:

21 CEOs Send Congress a Letter Calling for Comprehensive Tax Reform

Today, on the one year anniversary of the U.S. earning the dubious distinction of having the world’s highest corporate tax rate, 21 CEOS from some of America’s largest companies sent a letter to the Chairmen and Ranking Members of the House Committee on Ways and Means and the Senate Finance Committee calling for comprehensive reform of America’s tax code.

RATE CEO Letter:

Dear Chairmen Camp and Baucus and Ranking Members Levin and Hatch:

We write to you today to reinforce the need for comprehensive tax reform in order to improve economic growth and boost job creation. It has been one year since Japan lowered its corporate tax rate, leaving the U.S. atop the industrialized world as the country with the highest statutory corporate rate. Coupled with our complicated tax system, this rate makes American businesses less competitive and makes the U.S. a less attractive place for investment, ultimately harming businesses, investors, workers and consumers.

Read more here.

Ernst & Young Report/Tax VP Meetings:

Study: Corporate tax rate a drag on economic growth

Bernie Becker, The Hill

The U.S. economy could take a hit if Washington policymakers don’t move to lower the corporate tax rate, a new study finds.

U.S. Losing Ground from Higher Corporate Tax Rate

Michael Cohn, Accounting Today

The U.S. economy will be between 1.5 and 2.6 percent smaller over the long-term because other nations’ corporate tax rates are considerably more competitive, according to a new study by Ernst & Young and the RATE Coalition, a group lobbying for lower corporate tax rates.

Group: Corporate taxes could hurt economy

Kelsey Snell, Politico

A group of some of the nation’s largest corporations is taking to Capitol Hill on Wednesday with a new study arguing that high corporate tax rates in the United States will drive down wages and put a damper on the overall economy for years to come.

Neal: Some Tax Breaks Should Not Be Touched

Kelsey Snell, Politico

House Ways and Means Committee Democrat Richard Neal told members of the RATE Coalition today that simplicity and fairness should be shared goals in tax reform, but he will not support ending some tax breaks in the quest for a lower rate.

Corporate Executives Hit the Hill with Tax Reform Message

Steven Sloan, Politico

Tax executives from eight of the nation’s largest corporations — Lockheed Martin, Boeing, T-Mobile, Disney, Viacom, Liberty Media, Home Depot and Ford — were on Capitol Hill last week pressing lawmakers to overhaul the tax code in a way that lowers corporate rates. The corporate representatives met in private with Sens. Chuck Schumer, Ben Cardin, Debbie Stabenow, Sherrod Brown, Ben Nelson and Rep. Kenny Marchant. All of the executives on the Hill are members of the RATE Coalition, a group of companies dedicated to lobbying for a corporate tax cut. The coalition is slated to release a study that argues the U.S. economy will shrink in the coming years unless corporate rates are cut in a way that is more aligned with tax laws in other countries. “The message is that any tax reform need to include a reduction in the corporate tax rate,” Anne Buettner, Disney’s senior vice president of corporate tax, told reporters this morning. “There’s so many benefits associated with reducing the tax rate.”