Two recent op-eds in California papers reinforce the critical goals of corporate tax reform: Create jobs and strengthen the American economy. It doesn’t matter if you are a Democrat from Montana or a Republican from Michigan, a tech company in Boise or an entrepreneur in Austin. We all would benefit from a modern tax system that levels the global playing field so American companies can compete around the globe, expand investments in their employees and facilities here at home, and develop the next-generation of products and services that can be designed and built here in the U.S.
In a column in the San Jose Mercury News, ITI President & CEO Dean Garfield lays out three key principles for U.S. tax reform:
- A globally competitive corporate tax rate;
- A market-based tax system that creates an incentive for U.S.-based businesses to invest their overseas earnings in the U.S.; and
- Innovation tax incentives to drive new research and development.
|[A]s source code is the backbone of our information technology capabilities, the tax code is our economy's source code . . . Just as the world's best software needs an upgrade to drive new innovation, our economy's source code needs a major update. I hope [Senator] Baucus and [Representative] Camp will gain an even stronger understanding of how a modern tax code can magnify the positive impact the tech sector has on the U.S. economy and relay to their congressional colleagues the competitive urgency for action to drive new growth and opportunity for the U.S. economy.|
Dean is referencing the two-day visit, starting today, to two Silicon Valley companies -- including ITI-member Intel -- by Democratic Senator Max Baucus of Montana and Republican Representative Dave Camp of Michigan. These men are leading bipartisan efforts in Congress to rewrite the corporate tax code, and they authored their own column in the Orange County Register that reflects similar themes.
Imagine the U.S. economy is a car driving down a highway. Our goal as a nation is to keep one foot on the gas pedal, and head straight down the road to economic recovery and growth, leading to more jobs and higher wages.
But our current tax code acts like a wheel out of alignment, slowly pulling the car further and further off-track. There are warning signs across the dashboard, alerting us to the problem, and they are starting to flash with greater frequency.
. . .
And while the U.S. tax code is dragging our economy down, other countries are surging ahead in the global marketplace. Most of our global competitors have updated their tax laws, but our outdated international tax system actually encourages American businesses to keep profits and jobs outside America. Because of the U.S. tax code’s complexity and our high tax rates, America is falling further and further behind on the international stage.
These are the warning signs on the dashboard -- we have to fix the car now or risk being left on the side of the road. For the good of our economy, and for the sake of making the tax code simpler and fairer for families, Congress needs to come together to fix the tax code.
We absolutely agree. Tax reform is about job creation and economic growth. It’s about giving American companies the opportunity to compete with businesses around the world on a level playing field.
ITI’s Robert Hoffman will be at Intel for the “Max and Dave tour” visit on Tuesday, and will send his reactions.