It sounds like an April Fool’s Day joke, but in one week – April 1 – the United States will have the highest corporate tax rate in the world.
One can argue whether corporations are people, and one can argue whether it’s worse to tax individual income than corporate income. But it shouldn’t be terribly controversial to argue that if we have the highest tax rate in this area in the world, that corporations that have the option of relocating elsewhere will explore that option.
I suppose that if no one looks too closely at the fine print, Obama can say he’s made America a global leader again.
To his credit, Obama wants to lower the corporate tax rate from 35 percent to 28 percent. That would still leave the U.S. at the higher end, but at least no longer the worst among our economic competitors. Mitt Romney wants to lower it to 25 percent.
Of course, Obama wants to eliminate all corporate tax breaks for particular industries except his favorites: manufacturing, research, and clean energy. And while reducing the corporate tax rate, Obama wants to simultaneously increase tax rates on dividends and capital gains – giving back with one hand and taking the money back with another.