Obama pitches overhaul of corporate tax system

President Barack Obama on Wednesday proposed a lower corporate tax rate and an end to dozens of loopholes he said helps companies move jobs and profits overseas. “It’s not right and it needs to change,” he said.

WASHINGTON — President Barack Obama on Wednesday proposed a lower corporate tax rate and an end to dozens of loopholes he said helps companies move jobs and profits overseas. “It’s not right and it needs to change,” he said.

The president wants to lower the corporate tax rate from the current 35 per cent, the highest in the world after Japan. Under his plan, manufacturers would receive incentives so that their effective tax rate could be even lower.

Obama’s election-year plan would set a new 28 per cent corporate tax rate, still higher than the 25 per cent rate sought by congressional Republicans.

“It’s a framework that lowers the corporate tax rate and broadens the tax base in order to increase competitiveness for companies across the nation,” Obama said in a statement.

Corporations would have to give up dozens of cherished loopholes and subsidies that they now enjoy. Corporations with overseas operations would also face an unspecified minimum tax on their foreign earnings.

The proposal outlined by Geithner would also eliminate tax loopholes and subsidies that Geithner called “fundamentally unfair.”

Obama also would set a minimum tax on the foreign earning of U.S. companies.

Chances of accomplishing such change in the tax system are slim in a year dominated mostly with presidential and congressional elections. But for Obama, the proposal is part of a larger tax plan that is central to his re-election strategy.

Treasury Secretary Timothy Geithner, who rolled out the plan Wednesday morning, acknowledged that the debate “will be politically contentious.”

“Some will say these proposals are too tough on business, and others will say that they’re not tough enough,” he said.

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Red Deer churches easing back into services

“To be able to do that again was just incredible”

Sylvan Lake man charged with child luring

A 38-year-old Sylvan Lake man has been charged with child luring. Sylvan… Continue reading

Spike in bike thefts prompts Red Deer RCMP warning

Nearly a dozen bikes reported stolen in Red Deer in last week

If an MP heckles in a virtual House of Commons, does it make a sound?

If an MP heckles in a virtual House of Commons, does it make a sound?

How much will be enough when it comes to Canada’s COVID-19 supply?

How much will be enough when it comes to Canada’s COVID-19 supply?

Twenty-nine of Canada’s 48 national parks to reopen to day-use visitors in early June

Twenty-nine of Canada’s 48 national parks to reopen to day-use visitors in early June

Advocates push Ottawa to fix long-term problems with long-term care

Advocates push Ottawa to fix long-term problems with long-term care

COVID-19 shows need for long-term-care reform but solve crisis first, Trudeau says

COVID-19 shows need for long-term-care reform but solve crisis first, Trudeau says

Alberta premier says targeted approach needed to prevent COVID-19 resurgence

Alberta premier says targeted approach needed to prevent COVID-19 resurgence

Military has located wreckage of helicopter and remains in Mediterranean

Military has located wreckage of helicopter and remains in Mediterranean

Five things to know about the Meng Wanzhou extradition case

Five things to know about the Meng Wanzhou extradition case

Most Read