One result is that corporations have fled the country for low tax and low wage environments overseas. To make matters worse, many of these former U.S. businesses are selling their products back to American consumers, undercutting American businesses in the process.
It is time for corrective action. Now that the Obamacare replacement bill has spectacularly failed, it is time to focus on an issue not as controversial. Almost all Republicans agree with the need to lower taxes for struggling individuals and businesses.
By cutting corporate taxes, the United States will be able to retain our corporate base and entice former U.S. companies to move back home. Currently, the statutory corporate tax rate is 39.1% in the United States, which includes the top federal rate of 35% and the average state corporate tax rate. This rate is the highest among the G20 nations.
While other countries have been lowering the corporate tax rate in recent years, the United States has done very little to provide corporate tax relief since 1993, creating an uncompetitive climate for our businesses. It is very difficult to retain or attract major corporations with the highest tax rates in the world.
Under House Speaker Paul Ryan’s tax plan, the top federal corporate tax rate would be lowered from 35% to 20% or lower, making our country extremely competitive with our G20 competitors. Along with tax relief, another component of the Speaker’s plan is a Border Adjustment Tax (BAT). This will be imposed on imported products that are made outside of the U.S. and sold to American consumers.
According to Ryan and House Ways and Means Committee Chairman Kevin Brady (R-Texas), this tax would bring in $1 trillion and offset the loss of tax revenue from lower rates. It will insure that the tax plan can be passed in the U.S. Senate via reconciliation because it will not add to the deficit over ten years. In this way, the plan can be approved by only a bare majority of 51 Senators, which is very important since Republicans only control 52 seats and cannot depend on the support of any Democrat Senators.
The BAT will not extend to businesses who make products in the United States to sell to foreign countries. Instead, it is a targeted tax on imports. It provides a strong incentive for businesses to remain in our country and employ Americans. This is vital for the labor force participation rate is hovering at a 40-year low and there are approximately 95 million Americans no longer in the workforce. Many of these Americans have become disillusioned and stopped looking for work because of the dearth of decent employment opportunities.
In the campaign, presidential candidate Donald Trump outlined a simple three-part agenda, “jobs, jobs, jobs.” A Republican tax cut plan, including a BAT, would help our build our workforce while encouraging companies to stay and expand in this country.
In previous administrations, companies were practically encouraged to leave the United States. Under President Trump, we are pursuing “America First” policies in all areas of our government, from the military to the economy. By cutting corporate taxes and establishing a BAT, we would encourage our businesses to build their workforce and stay in the United States, an “America First’ policy.
Thank goodness, the American people elected Donald Trump as President last November. He is an ultra-successful businessman who understands how to thrive in the private sector. He is bringing this insight into the Oval Office. Not surprisingly, he has used executive orders to cut regulations and red tape, giving more opportunity for our businesses to succeed.
He also wants to create a level playing field in international trade. Foreign countries, such as Mexico, levy a 16% tax on American goods imported into their country, but we do not reciprocate. The reason is that corporate giants such as Walmart have lobbied Congress to do nothing to rectify this glaring imbalance. Walmart benefits from the flight of American companies to other countries because they roduce cheap foreign goods and keep prices low in their stores.
These low prices attract consumers to Walmart, but at the heavy cost of American jobs and manufacturing facilities.
It is time to create parity with other countries and put American workers first. Fortunately, President Trump does not bow at the altar of globalism and free trade. He recognizes that trade is indispensable for the American economy to flourish, but only if it is fair.
A crucial step toward fair trade policies is to implement the BAT. It provides incentives for American businesses to grow in this country and it raises revenue to help pay for crucial tax cuts this country desperately needs to become competitive.
It’s time to contact Congress and demand that this important provision be included in any tax reform bill. From this point forward, all our policies should be focused solely on what is best for the American people, in other words, it’s time to put “America First.”Tweets about trump tax reform
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