Although it isn’t perfect, the corporate tax bill Congress passed earlier this month is a winner. It will aid business expansion and job creation.
This is the best way to help companies — much preferred in our view to government subsidies and other pork-barrel spending on companies. (We say that with the caveat that some subsidies might have been slipped into the finer details of this bill and might come to light in the future.)
“The tax bill … began as an effort to help U.S. exporters avoid European tariffs,” reported The Associated Press. “But as Republican leaders hunted for votes, it swelled into the most profound rewrite of the corporate tax code in two decades.”
“(T)axes were cut (over 10 years) for U.S. manufacturers by $76.5 billion. The top corporate tax rate was cut by 3 percent — to 32 percent — and qualifying businesses were expanded to include engineering and architectural firms, film and music companies, and the oil and gas industry.”
Another $43 billion in tax cuts went to multinational corporations. And the bill includes a lot of targeted special-interest tax cuts, such as breaks for ethanol producers and NASCAR track owners. That’s the sort of thing you have to put up with, alas, to get major legislation passed.
The bill also closes $82 billion in tax loopholes. There is some chance the end of the loopholes might do some harm in increasing some business costs as this bill works itself out over the coming years, in which case Congress would have to fix the problems. But cutting corporate tax rates overall still is a needed reform.
Sen. Kerry did not vote on the bill. President Bush said he would sign the bill. It should be good for America.