by Kyle Wingfield, Esq.
On February 22, 2012, the Obama administration issued The President’s Framework for Business Tax Reform (the “Proposal”), an outline for what would be the first major overhaul of the U.S. Tax Code since 1986. In broad form, the Proposal would reduce the top income tax rate for corporations from 35% to 28%, increase revenues by eliminating dozens of perceived tax loopholes and deductions to broaden the overall tax base and create new disincentives for U.S. businesses to shift operations overseas, including, for the first time ever, a minimum tax on foreign earnings.
Corporate tax reform undoubtedly will become a major issue during the 2012 presidential campaign, but significant changes are probably years away. Individual taxes will be addressed first, as the Bush tax cuts are scheduled to expire at the end of the year. Then, as with all significant legislation, corporate tax reform will be subject to intense lobbying in Congress.
Nevertheless, we believe that some version of corporate tax reform is coming within the next few years. The U.S. will soon have the highest statutory corporate tax rate among all advanced countries, and most Democrats and Republicans agree that the current system is uncompetitive, inefficient and overly complicated.
The following discussion summarizes the key aspects of the Proposal in further detail. Although corporate tax reform will look markedly different when enacted, it is important to consider the reforms President Obama proposes and what they could mean for your business. More>>
Kyle Wingfield is an Associate with Williams Mullen. He focuses his practice on the taxation of businesses, with a particular emphasis on corporate and international tax matters. Read his complete bio.
Williams Mullen provides legislative counsel to the Virginia Society AIA and its legislative partners: The American Council of Engineering Companies/Virginia and the Virginia Society of Professional Engineers