Washington loves its panaceas. A few years ago, it was Army General David Petraeus who could fix any problem -- up to and perhaps including the presidency. Then it was the Simpson-Bowles commission, or maybe the congressional supercommittee on deficit reduction. Today’s cure-all? Tax reform.
In selling an expanded payroll tax cut to lawmakers, the Obama administration faces the predicament it confronts in defending its $825 billion stimulus package: making a case that the economy would be worse without it.
President Barack Obama laid the groundwork for reducing the corporate tax rate and simplifying the tax code in his State of the Union address . He also erected a political hurdle to these efforts as they could lead to higher rates for millions of businesses.
The tax incentive for business research should survive an overhaul of the corporate tax code that would prune other tax breaks and lower the 35 percent rate, the U.S. Treasury Department’s top tax policy officials said.