There isn't consensus on much in Congress these days, but one thing both parties seem to agree on is that the corporate tax rate should be reduced. House Republicans want to it lowered to 25%--it's currently at 35%. The Obama Administration and many Democrats want it reduced as well, but not by as much. The proposed cut comes at a time when U.S. corporations are doing better than ever. In 2010, Hewlett-Packard, for example, reported $11 billion in profit. Its CEO made $24 million, but the company paid $2.2 billion in taxes—a 20% rate that’s well below 35%. Big corporations hire professionals to find loopholes which can wind up saving millions in taxes. Some argue that the corporate tax cut will make U.S. corporations more competitive and level the playing field for smaller business that don't have the resources to employee tax attorneys to find loopholes. Is a lower corporate tax rate good for U.S. business and thus good for the economy? Will a corporate tax cut trickle down and benefit all Americans, or will it result in the need to make up government revenue elsewhere, such as cuts to Medicare or Social Security?
Rep. Jim McDermott, D-Washington’s 7th District; member of the House Ways & Means Committee
Curtis Dubay, senior policy analyst for tax policy, The Heritage Foundation
Steve Breaux, public interest advocate, WASHPirg, a Washington public interest research group