What People Are Saying About the Obama Administration’s Corporate Tax Reform Framework

“Miss the mark,” “more complicated for a small-business owner,” “adds complexity,” “not making sense,” “totally misguided,” and “devil’s in the details, which aren’t there,” is how America’s job creators and economists alike are talking about the President’s Corporate Tax Reform Framework. Let’s take a look:

America’s Job Creators:

“The president suggests some changes that will help, but many of the proposals completely miss the mark and would make U.S. businesses less competitive,” said National Association of Manufacturers President and Chief Executive Officer Jay Timmons. (WSJ, 2/22/12)

“Once again, President Obama has demonstrated that he knows big business, not small,” said Dan Danner, CEO of the National Federation of Independent Business. “For the last several years, small-business owners have been trying to convey to Washington, D.C., that the uncertainty of its policies makes it incredibly difficult to run a business and plan for the future and today’s announcement of corporate tax reform shows that Washington still does not understand. Reforming the corporate tax code does not help the majority of small businesses; in fact, it creates even more uncertainty by taking away the deductions that many small-business owners count on each year. Furthermore, as complicated as the tax code is, this plan from the administration will make it even more complicated for a small-business owner. At what point does big business stop dictating the policies in Washington, D.C.? The focus should be on individual rate reform, keeping the tax rates for small business low, and allowing small businesses to actually grow and create jobs, as opposed to being a piggy bank for the IRS.” (NFIB Press Release, 2/22/12)

“The last comprehensive tax reform in the United States was a generation ago. The U.S. tax system has become increasingly outdated, complicated and uncompetitive as the world economies have grown more interconnected,” Business Roundtable (BRT) President John Engler said. “The framework adds complexity and raises taxes, moving us away from the rest of the world.” (BRT Press Release, 2/22/12)

“The president's proposal is partially undermined by a number of proposed tax increases, such as the proposal to create a new global minimum tax for American companies,” said Kenneth Bentsen, executive vice president for public policy at SIFMA. (WSJ, 2/22/12)

“Government shouldn’t use the tax code to pick winners and losers,” said Katherine Lugar, executive vice president for public affairs of Retail Industry Leaders Association (RILA). “Unfortunately, the president’s proposal preserves special preferences that give some industries advantages at the expense of others.” (The Hill, 2/22)

“Reform needs to address small businesses as well as corporations, and needs to be fair to all industries rather than favoring one over another,” said Matthew Shay, National Retail Federation president and chief executive. (The Hill, 2/22)

Economists:

“So far, a persuasive case for a manufacturing policy remains to be made…,” said former Obama Administration economics advisor Christina Romer said. (NY Times, 2/4)

“The administration is not making sense,” says Martin Sullivan, contributing editor at publisher Tax Analysts. “The whole idea of corporate tax reform is to get rid of loopholes, and this plan is adding loopholes back in.” (Associated Press, 2/22)

“The minimum tax proposal for international earnings ‘is totally misguided both from a competitive standpoint and a jobs standpoint,’ said Gary Hufbauer, a senior fellow at the Peterson Institute for International Economics. ‘Obama's plan, if enacted, will shrink the U.S. footprint in world markets and lose jobs.’” (Associated Press, 2/22)

“But the devil is in the details, which aren't there,” said Scott Brown, chief economist with Raymond James. (ABC.com, 2/22)

“And from a political viewpoint, I am worried that once one starts introducing special treatment of one area of the economy, it undermines the case that other areas shouldn't also get special treatment,” said William Gale of the Tax Policy Center. (ABC.com, 2/22)

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