Sen. Orrin Hatch (R-Utah) expressed appreciation Jan. 14 that the administration is examining corporate tax reform options, but warned officials against attempting to increase taxes at the same time.
“When it comes to tax reform, we should cast a wide net and thoroughly examine our entire tax code to make it more efficient by broadening the base, while lowering rates,” said Hatch, the incoming ranking member of the Senate Finance Committee. He cautioned the administration “and its Capitol Hill allies, however, against pursuing any tax increases under the guise of so-called reform. This would unnecessarily politicize a much-needed discussion of how to fix and improve our tax code.”
Hatch also called the nation's corporate tax rate a “serious drag” on the nation's ability to compete in the global marketplace.
Hatch's comments came as Treasury Secretary Timothy Geithner was hosting a meeting with corporate executives on the topic of tax reform and possible incentives for improving domestic investment.
The Treasury Department did not release a readout from Geithner's meeting, but did release the names of the 18 companies represented during the session. Including in the meeting were officials from Honeywell; Cisco Systems; Johnson & Johnson; The Coca-Cola Co.; Emerson; United Technology Corp.; Wal-Mart; Exxon Corp.; PepsiCo; Microsoft Corp.; Procter & Gamble Co.; Bank of America; Caterpillar Inc.; Disney; Eli Lilly; General Electric; Dow Chemical Co.; and MetLife.
Separately, Geithner touted the massive tax cut package enacted in December 2010, saying it will provide a boost to individual taxpayers and the entire economy. Geithner used the White House daily press briefing as a forum for his comments, noting that tens of millions of workers were receiving their first paychecks of 2011 and would see some relief from the Social Security payroll tax.
Included in the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act (Pub. L. No. 111-312) was a provision cutting 2 percentage points off of the individual side of the Social Security payroll tax, dropping it from 6.2 percent to 4.2 percent for 2011.
“Now, the economy was starting to strengthen in the fall, but in significant part because of the impact of this tax package, you're seeing most private economists say the economy this year's likely to grow between 3 [percent] and 4 percent,” Geithner told reporters. “And the range of private forecasters have said this package is likely to add about 1.5 million jobs.”
The complete text of this article can be found in the BNA Daily Tax Report, January 18, 2011. For comprehensive coverage of taxation, pension, budget, and accounting issues, sign up for a free trial or subscribe to the BNA Daily Tax Report today.