Nelson tells business group corporate taxes are ‘too high and too complex’by George Bennett | May 17th, 2012
While not offering specifics, Nelson seemed to suggest an overhaul in which rates would be lowered in exchange for closing loopholes and eliminating tax breaks. He said he’s been talking with Republican Ohio Sen. Rob Portman, who’s been mentioned as a potential Mitt Romney running mate.
“Our corporate tax is too high and too complex, and it stifles competition. In fact, the United States has the highest statutory corporate income tax rate in the developed world,” Nelson said in an advance copy of his remarks.
At the same time, Nelson said, the U.S. ranks 18th to 25th in the world in corporate tax revenue as a percentage of gross domestic product.
“I believe that we can actually cut the corporate income tax rate and improve tax fairness at the same time. That’s because, right now, some firms pay an effective rate well above 30 percent, whereas other corporations pay nothing at all,” Nelson said.
Read the entire prepared text after the jump…
Sen. Bill Nelson remarks to Florida Council of 100, as prepared for delivery Wednesday:
Let me begin by saying it’s an honor and privilege to serve Florida in the Senate.
Right after the debt-debacle in Congress last year, I remember watching as Standard & Poor’s decided to downgrade America’s credit. It was hard to stomach.
But there was a lesson in that mess we should never forget: The hyper-partisanship has to stop. If it doesn’t, we really will be on the road to political and economic ruin.
We have to bring civility back to the public square. We have to govern by building consensus.
I’m proud our state has a rich tradition of senators working together, reaching across the political aisle, putting forward what’s best for all Floridians. My colleague Marco Rubio said recently: “We have a very good working relationship, which is in a long tradition of Florida senators. I think that’s important,” Marco said. “Our state expects that of us.”
I couldn’t say it better.
Of course, when folks differ our dialogue can be respectful; and, our doors can be open.
Anything less and battle lines are drawn. Anything less — gridlock.
The result of gridlock: nothing gets done and nobody wins.
President Kennedy said: people don’t want Democratic solutions or Republican solutions, they want the right solutions.
I believe America’s best days are still on the horizon. I am an optimist.
We prevailed through world wars and a Great Depression. We’ll get through this.
There have been signs the U.S. economy is improving. But folks in Florida feel like it isn’t recovering fast enough.
And it probably won’t recover fast enough, unless we restore some fiscal sanity to the federal government – which means cutting wasteful government spending and balancing the budget by reducing the annual deficit.
To do that, America badly needs tax reform.
Our tax code has become a bewildering maze.
We need to restore public confidence in our tax system by repealing preferences that designate winners and losers. That should be the job of the market, not the revenue collector.
Sen. Portman and I have talked about a reasonable, common-sense approach to tax policy that gives hope for a fundamentally reformed and modernized tax system that can function in the hyper-competitive 21st century.
Reforming the corporate income tax would be a good place to start. In many areas, the tax code borders on incoherence.
Our corporate tax is too high and too complex, and it stifles competition. In fact, the United States has the highest statutory corporate income tax rate in the developed world.
It’s imperative to have a healthy, vibrant, private sector that creates new, well-paid jobs for American workers.
Yet our international tax rules penalize American firms for bringing their overseas profits back to the United States to reinvest here at home.
The problems with our corporate tax code are well-known and well-documented.
For example, the rules related to corporate mergers and acquisitions reflect a long line of cases, statutory amendments, and IRS rulings that are staggering in their complexity and unpredictability.
At best, these can be burdensome and inefficient. At worst, they can stifle economic growth.
Although we have the highest corporate tax rate, we rank around 18th out of 25 among developed countries in corporate tax revenue as a percentage of gross domestic product.
Last September, I chaired a Senate Finance subcommittee hearing where Alan Greenspan and others testified on the need for tax reform.
The panel of witnesses, which included experts from across the political spectrum, was united in its view that the complexity of the tax code was unfair, inefficient, and actually undermined revenue collection.
I believe that we can actually cut the corporate income tax rate and improve tax fairness at the same time. That’s because, right now, some firms pay an effective rate well above 30 percent, whereas other corporations pay nothing at all.
I also believe that a key to our economic recovery is having thriving and vibrant small businesses. In Florida alone, there are some two million small businesses – accounting for 44 percent of all private sector jobs.
In the wake of the economic recession, Congress recognized that if we didn’t help small businesses get back on their feet there’d be no hope for an economic recovery.
So we passed the Small Business Jobs Act.
Among other things, the law sent $98 million to Florida for a lending program to foster small business development.
Of more regional importance is passage of the RESTORE ACT, which would send the lion’s share of the fine money paid by BP to the Gulf Coast communities for restoration and economic development.
I can’t imagine anyone wanting to see this money going someplace else.
Meantime, I’m on the conference committee that will iron out differences between the House and Senate versions of the broader transportation bill.
For me, keeping the Senate measure in the final highway bill is an absolute top priority.
I see people in this room tonight who have deep roots in Florida.
And what drives me on is the dedication to improving Florida and our quality of life by groups like you and the Floridians we serve.
Thank you for standing up and fighting for our great state.