Building a Bipartisan Tax Reform Bridge to Economic Growth
In the last few remaining months of 2013, Congress is facing a wide range of issues requiring action. Corporate tax reform should be right at the top of the list.
Our woefully outdated U.S. corporate tax code puts American companies at a global competitive disadvantage and is holding back the full potential of the U.S. economy. Done right, revenue-neutral corporate tax reform can reduce distortions in our current tax code and the competitive disadvantages U.S. companies face overseas. And, most importantly a simpler tax code will grow our economy and create jobs.
FedEx was honored to host Senate Finance Committee Chairman Max Baucus (D-Mont.) and House Ways and Means Committee Chairman Dave Camp (R-Mich.) at the FedEx Express World Hub in Memphis September 9th, as they toured the country promoting efforts to make the nation’s tax code simpler, fairer, and more productive. During their visit, they met with FedEx leaders including FedEx Chairman, President and CEO Frederick W. Smith, and the leaders of several small and medium-sized businesses.
FedEx is a staunch supporter of the Chairmen’s efforts. America has the highest corporate tax rate in the industrialized world. The all-in U.S corporate tax rate (federal and state) is 39 percent, more than 50% higher than the 25 percent all-in average of other developed countries, including major economies like China, Canada, and the U.K. It is also one of the most complicated, distorted, and inefficient tax codes in the world that, among other things, actually penalizes U.S. companies for bringing cash earned offshore back into the U.S. Everyone agrees this is crazy, so let’s do something about it.
A globally competitive tax system requires a reduction in the corporate tax rate to 25 percent and the adoption of a modern hybrid international tax system that protects the U.S. tax base. FedEx believes this can and should be accomplished without adding a dime to the federal budget deficit and without using revenues from small business.
As Washington debates the specifics of tax reform over these next few months, the areas of consensus between Democrats and Republicans which forward-thinking leaders like Senator Baucus and Congressman Camp have forged can serve as a foundation for comprehensive reform. Our country has never needed reform more than it does now. And by some calculations, we are but a stone’s throw from making it happen.
By working in a bipartisan fashion, President Obama and members of Congress can put in place the principles for a competitive tax system this year that will benefit all U.S. businesses and workers, restore America’s global competitiveness and fuel sustained economic growth.
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