Corporate Taxes

A note from an old friend (Jim Pinkerton) about his partnership with Elaine Kamarck (see syllabus).

The RATE Coalition http://ratecoalition.com/ is a new bipartisan group aimed at reducing the US corporate income tax rate. I am the Republican co-chair, and Dr. Elaine Kamarck, an alum of the Clinton-Gore White House who now teaches at the Kennedy School, is the Democratic co-chair.

We all realize that Washington is profoundly polarized on a great many issues, but Elaine and I also believe in the power of effective compromise based on good ideas. And one such idea, with substantial support on both sides of the aisle, is reducing the corporate income tax rate, so that US companies can be more competitive in the world marketplace, and thus keep more jobs and revenues here in the US. We note that many top Democrats, as well as many top Republicans, have expressed support for some sort of rate-lowering/base-broadening approach.

The US today has the second-highest corporate tax rate among the 34 nations of the OECD. We believe that this high rate is damaging to American competitiveness What makes the RATE Coalition unique is that the members of the RATE Coalition are willing to put on the table, the issue of tax loopholes/shelters/expenditures. In other words, in its emphasis on seeing a lowering of the corporate tax rate, the RATE Coalition is willing to say goodbye to favored breaks, because a lower rate is more important.

We believe that such willingness could prove to be the key to actually hammering out an effective solution, even amidst the current gridlock.