Tags: republicans | corporate tax cut | debate

Size of Corporate Tax Cut Sparking Debate Among Republicans

Image: Size of Corporate Tax Cut Sparking Debate Among Republicans
House Republicans start a news conference following a vote on tax reform on Capitol Hill in Washington, Nov. 16, 2017. (Susan Walsh/AP)

By    |   Thursday, 30 November 2017 09:29 AM

Even as Republicans push for the biggest corporate tax cut in American history, some economists and corporate executives are cautioning it will not necessarily lead to companies hiring more people and paying them better, Politico is reporting.

As a result, President Donald Trump and GOP lawmakers could be left with a political headache in 2020, the website warned.

"Frankly, I think they are bonkers," David Mendels, the one-time chief executive officer of the software firm Brightcove, said of GOP officials counting on a lower corporate rate to generate bigger worker paychecks.

"It really doesn't work that way. No CEO sits there and says, 'When my tax rate goes down, I'm going to hire more people and pay them more.'"

Some GOP lawmakers have expressed concern that reducing the top corporate rate from 35 percent to 20 percent will not lead to the necessary economic growth needed to offset the additional $1.5 trillion debate the plan projects over the next decade, according to Politico.

Several Republican senators are calling for a "trigger" to automatically boost taxes again in the coming years if the economy isn't growing quickly enough.

"It's hard to imagine a more counterproductive policy than imposing automatic tax hikes on an economy that isn't growing as fast as expected," Nathan Nascimento, executive vice president of Freedom Partners, said.

And Grover Norquist of Americans for Tax Reform called the trigger idea "a self-fulfilling threat to kill jobs."

Meanwhile, The Wall Street Journal reported that some Senate Republicans are deciding whether to cut the corporate tax rate less deeply.

Changing that rate to 21 percent or 22 percent is gaining interest from some Republican lawmakers who are trying to find money to expand the child tax credit, preserve a property-tax deduction or make other changes, the newspaper said.​

Each point raises about $100 billion over a decade, the Journal reported.

But Sen. John Cornyn of Texas, the Senate's second-ranking Republican, will likely oppose any amendments to put the corporate rate above 20 percent, an aide said.

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Even as Republicans push for the biggest corporate tax cut in American history, some economists and corporate executives are cautioning it will not necessarily lead to companies hiring more people and paying them better, Politico is reporting.
republicans, corporate tax cut, debate
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2017-29-30
Thursday, 30 November 2017 09:29 AM
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