One of the cornerstones of the President’s plan to create a better bargain for the middle class is to ensure that every American who is willing to work for it will have the opportunity for a good job that pays good wages. In today’s speech, the President laid out an idea that both parties should be able to support to create jobs: a plan that simplifies the tax code for our businesses and gives working families a better deal.
Our current tax code is broken and too complex, with businesses that play by the rules paying a 35% tax rate while many corporations that can hire hundreds of lawyers pay virtually no taxes at all. That is why the President has called for a revenue-neutral simplification of our business tax code to eliminate loopholes that encourage companies to ship jobs overseas and establishes a top tax rate of 28%. Under the President’s proposal, some businesses would pay less, some corporations would pay more, but everyone would pay their fair share. But if we’re going to give businesses a better deal, we should give the people who work there a better deal too. Today, the President is calling for a pro-growth tax reform and jobs package that would be fully offset using one-time revenues raised as we transition to a new business tax system. The transition revenue would support much-needed investments such as modernizing our infrastructure; creating new manufacturing hubs; and training our workers with the skills they need for the jobs of today and tomorrow. At the same time, President Obama remains committed to pursuing a long-term deficit reduction deal that includes revenue-raising individual tax reform and a balanced approach to replacing the damaging sequester.
The bottom line is that the President will work with Republicans on a package to simplify our business tax code so long as it includes real investments to help restore middle class security, create jobs and grow the economy.
Summary of the Pro-Growth Tax Reform and Jobs Package
v Simplify the Tax Code for Businesses to Create Jobs and Economic Growth: The President has put forward a framework for simplifying the corporate tax code to encourage job creation here at home – without adding a dime to the deficit:
Ø Eliminating Loopholes While Lowering the Top Rate to No Higher than 28%
Ø Simplifying Tax Filing and Increasing Incentives to Invest for Small Businesses
Ø A Manufacturing Tax Rate No Higher Than 25%
Ø Removing Incentives to Locate Overseas
v A Broader Package to Support Middle Class Jobs: The President believes we can design a broader growth and jobs package without adding a penny to the deficit by, for example, using one-time funds raised as we transition to a new tax system to support investments like:
Ø Rebuilding American Infrastructure:
- Immediate Infrastructure Investments With a “Fix It First” Focus
- A “Rebuild America Partnership” to Leverage Private Sector Funds
- “America Fast Forward” Bonds – Including for Modernized Schools
Ø Creating 45 New Manufacturing Innovation Institutes Over 10 Years
Ø Investing in Community Colleges to Train Workers for Jobs of the Future
v New Executive Actions on Jobs: In addition to the package above, President Obama announced new executive actions to support jobs:
Ø Building A Competitive Edge for Foreign Investment Through An Expanded SelectUSA
Ø Call to Action on Public-Private Efforts to Get the Long-Term Unemployed Back to Work