Data provided by iNet BFA
Loading...
See More

Obama to pare tax breaks for big firms

Feb 13 2013 09:50 Reuters

President Barack Obama gestures as he gives his State of the Union address during a joint session of Congress on Capitol Hill in Washington. (J Scott Applewhite, AP)

Related Articles

Obama proposes raising minimum wage

Obama unveils plans to avert budget cuts

Obama: more tax revenue needed

Obama warns Congress of economic chaos

US not a bargaining chip - Obama

Obama to devote state address to jobs

 

Washington - President Barack Obama will renew his bid to curb tax breaks prized by corporations and the wealthiest Americans in a speech on Tuesday laying out his legislative agenda, but the proposals are sure to face familiar roadblocks from congressional Republicans.

The president will propose to "reform our business tax code, (lower) the corporate tax rate with an even lower rate for manufacturers," and set a minimum tax on offshore earnings, according to a fact sheet provided by the White House ahead of the annual State of the Union address to Congress.

Obama also will back tax reforms that close "loopholes for the wealthy," according to the summary.

If the plan sounds familiar, it should, because the ideas largely mirror those Obama pitched in his address a year ago. Since then, he won re-election campaigning on tax fairness and Republicans lost congressional seats, but even the president's backers say they face a tough road.

"Unless Republicans have a real 'come to Jesus moment,' it is difficult to imagine them supporting many or any of these provisions," said Jim Manley, a former top adviser to Democratic Senate Majority Leader Harry Reid.

The speech comes as another fiscal crisis brews in a stand-off between the White House and congressional Republicans, this time over automatic spending cuts set to kick in on March 1.

Obama and fellow Democrats back a mix of revenue and tailored spending cuts to avoid what is known as the "sequester," while Republicans oppose any tax increases.

Democrats and Republicans both say they want a full-scale revamp of the US tax code - but they are far apart on how to get there.

Republican Representative Dave Camp, who chairs the tax-writing House Ways and Means Committee, is working on a plan to revamp the tax code. Senate Finance Committee Chairman Max Baucus, a Democrat, is also working on a proposal.

But a full-scale tax code overhaul is a massive endeavor, and it has been somewhat crowded out by issues like immigration and gun control in recent weeks and months.

"It is not an issue that has much momentum behind it, but having people like the president and Dave Camp talking about it will help that," said Erik Smith, a former adviser to Obama who now advises companies at Blue Engine Media.

Obama has also called for review of the corporate tax code - including lowering the top corporate tax rate to 28% from 35%, to be paid for by closing business tax breaks.

Republicans back a lower corporate rate, but have resisted the idea of tackling it in isolation because many businesses file taxes through the individual side of the tax code and would be left out.

Follow Fin24 on Twitter, Facebook, Google+ and Pinterest.

barack obama  |  sa economy
NEXT ON FIN24X

 
 
 

Read Fin24’s Comments Policy

24.com publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
0 comments
Add your comment
Comment 0 characters remaining
 

Company Snapshot

We're talking about:

Small Business

Expanding your business requires capital and banks have stringent lending criteria in place.
 

Money Clinic

Money Clinic
Do you have a question about your finances? We'll get an expert opinion.
Click here...
Loading...