Mitt Romney Wrongly Claims Obama Raised Corporate Tax Rates
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The only problem with Mitt Romney's fact check of President Barack Obama after his State of the Union address was that the Republican presidential candidate used "facts" that weren't true.
Romney accused Obama of raising corporate tax rates during his presidency, something that Obama has not actually done, as Josh Marshall of Talking Points Memo first noted. Romney also claimed that Obama had lifted some of his ideas from Republicans -- including lowering taxes on corporations.
"Well, in some respects, I have to compliment the president on adopting a whole series of ideas that I've been speaking about for the last several years," Romney told NBC after the Tuesday night speech, according to UPI. "If you want to get the economy going, lower corporate tax rates -- of course, he's raised them."
But experts say that Obama has advocated for lowering the top marginal corporate tax rate, if anything. Since 1993, it has held steady at 35 percent. In 2010, the U.S. had the second-highest top marginal corporate tax rate of any member nation of the Organisation of Economic Co-operation and Development (after Japan), according to the group.
"There's pretty wide consensus, including from the president, that it would be ideal to lower the corporate tax rate," said Joe Rosenberg, a research associate at the Urban Institute. "I can't think of anybody who has called for increasing the 35 percent corporate rate."
In various budget proposals, Obama has mixed provisions that would raise taxes for some corporations -- but not the corporate tax rate itself -- with measures that would lower taxes for other companies. The overall trend has been to lower corporations' tax burden, Rosenberg said. For example, the president's 2009 stimulus plan included a variety of business-related tax cuts, including a much-criticized provision that would help companies buy their own corporate jets. Moreover, Congress hasn't passed any of the tax hike proposals.
"There's been lots of corporate tax cutting under Obama, but no corporate rate tax increases," said Robert McIntyre, director of the Center for Tax Justice. "Romney may be thinking Obama would like to do that, but since he says he wants to do the opposite, I just don't know how Romney could come up with this."
The Romney campaign didn't respond to multiple requests for comment by publication time.
In recent years, including under Obama's watch, many corporations have taken advantage of loopholes that have allowed them to pay significantly less than the top marginal tax rate. Nearly 300 of America's most profitable companies paid an average corporate tax rate of 18.5 percent between 2008 and 2010, and 30 companies paid less than zero in income taxes during the same period, according to a report released last year by the Center for Tax Justice.
Obama has made his objections to said loopholes known.
"He's talked about corporate tax reform that would lower the rate and close loopholes," McIntyre said. "He's never talked about raising the rate. He's never intimated that he would raise the rate."
In the State of the Union speech, Obama discussed a proposal to roll back tax breaks for U.S.-based multinational companies that keep profits overseas, which could force some corporations to pay more in taxes. But Rosenberg said even if the proposal were implemented, it wouldn't raise the corporate tax rate. Instead, it would force corporations to pay something closer to the rate that's technically required of them.
"Most of that is in response to pretty strong evidence that U.S.-based multinational corporations are shifting their incomes abroad in order to take advantage of the tax advantages far below the 35 percent marginal rate," Rosenberg said.
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Posted: 01/25/2012 4:09 pm