/PRNewswire/ -- Teamsters General President Jim Hoffa today said the proposal to impose a 35 percent tax on insurers for individual health insurance plans worth more than $8,000 is unfair and unnecessary.
The proposal, introduced by Senate Finance Committee Chairman Max Baucus, would also levy the 35 percent tax for family plans worth $21,000.
"We're pleased that Sen. Baucus stopped short of taxing American workers directly, but we fear that ultimately they will pay the price in higher-cost insurance," Hoffa said. "Middle-class wage earners cannot afford to pay more for health insurance than they already do. We much prefer the House plan, which would pay for expanded coverage by imposing a surcharge on those who can afford it - the wealthiest Americans."
"We will fight to convince the conference committee to drop this excise tax," he said.
Hoffa said the proposal misses the point that many plans are expensive because insurers have too much market power, not because they offer more health care than cheaper plans.
Hoffa also said the plan includes some laudable proposals, and he welcomed the progress toward insurance-market reform that is so urgently needed.
"We're pleased that the plan eliminates lifetime limits on coverage," Hoffa said. "But we're disappointed that it doesn't include a requirement that employers provide coverage for their employees."
"We do applaud his efforts to expand Medicaid to cover anyone with income less than 133 percent of the poverty level, including childless adults," Hoffa said.
Hoffa said the Teamsters support the House plan and the Senate Health, Education, Labor and Pensions Committee plan.
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Showing posts with label proposal. Show all posts
Showing posts with label proposal. Show all posts
Wednesday, September 16, 2009
Monday, May 4, 2009
Obama's Proposal to Double-Tax Profits Will Kill U.S. Jobs
/PRNewswire / -- With President Barack Obama and Treasury Secretary Tim Geithner today announcing a job-killing tax increase of over $200 billion over the next ten years, Americans for Tax Reform issued the following fact sheet on the state of international and corporate taxation:
America has the highest corporate income tax rate in the developed world. The United States is tied with Japan for one very dubious honor -- having the highest corporate income tax rate in the developed world. According to the OECD, the United States has a combined marginal corporate rate of nearly 40 percent. This compares very negatively to our European competitors' average rate of 25 percent. The Republic of Ireland stands in the starkest contrast, with a corporate income tax rate of 12.5 percent. In the developing world, rates of 10 or 15 percent are commonplace.
America is one of the only developed countries that double-taxes the international profits of our own companies. If a Polish company earns a profit in France, it pays the French corporate income tax, and nothing else. But if a U.S. company earns that same profit in France, it must pay the French corporate tax and the U.S. corporate tax (minus whatever was paid to France). So not only does the U.S. impose the highest corporate rate in the world, it makes sure that this rate is applied to both domestic and international profits. This is called a "worldwide taxation system" and the U.S. is one of a tiny handful of countries that still practices it.
Recognizing the problem this creates, Congress has crafted a confusing set of exclusions, deferrals, deductions, and credits on international profits. In general, U.S. companies can avoid paying this double-tax until they repatriate the profits back to the U.S.
By seeking to take away these double-tax band-aids without lowering the corporate rate substantially or fixing the global taxation scheme, Obama's proposal will shove jobs and capital out of America and into foreign countries. Obama's budget and Congressional tax-writers have been clear -- they want companies to pay the full corporate rate as soon as the international profit is earned. In a global economy, companies don't have to take this lying down. It's a relatively simple matter for a U.S. company with an Irish subsidiary to become an Irish company with a U.S. subsidiary. The Obama plan will force thousands of companies to make this job-killing decision. Companies that export goods will soon start exporting jobs.
The U.S. should tax our companies the way the rest of the world taxes theirs -- territoriality. The rest of the developed world has figured this out: if they want to retain jobs and capital in their countries, they have to adopt territoriality. This means that companies only pay corporate income tax in the country where the profit is earned. The U.S. partially tried this in 2005, when companies were allowed to repatriate deferred foreign earnings at a 5.25% rate -- far lower than what they would have to pay otherwise. The result was a one-year infusion of $318 billion in capital to the United States, resulting in $17 billion in additional corporate income tax payments, and the creation of thousands of new jobs.
The U.S. needs to lower our corporate income tax rate to become more competitive. American employers are competing globally with Irish, British, German, etc. companies. It makes no sense to saddle our employers with the highest corporate rate in the world. At the very least, we need to lower our corporate tax rate to 25 percent or less. This simply begins to make our tax treatment of large employers somewhat comparable to our European competitors. When combined with territoriality, this move would begin to change the corporate tax culture in the U.S. from a jobs killer to a jobs magnet.
America has the highest corporate income tax rate in the developed world. The United States is tied with Japan for one very dubious honor -- having the highest corporate income tax rate in the developed world. According to the OECD, the United States has a combined marginal corporate rate of nearly 40 percent. This compares very negatively to our European competitors' average rate of 25 percent. The Republic of Ireland stands in the starkest contrast, with a corporate income tax rate of 12.5 percent. In the developing world, rates of 10 or 15 percent are commonplace.
America is one of the only developed countries that double-taxes the international profits of our own companies. If a Polish company earns a profit in France, it pays the French corporate income tax, and nothing else. But if a U.S. company earns that same profit in France, it must pay the French corporate tax and the U.S. corporate tax (minus whatever was paid to France). So not only does the U.S. impose the highest corporate rate in the world, it makes sure that this rate is applied to both domestic and international profits. This is called a "worldwide taxation system" and the U.S. is one of a tiny handful of countries that still practices it.
Recognizing the problem this creates, Congress has crafted a confusing set of exclusions, deferrals, deductions, and credits on international profits. In general, U.S. companies can avoid paying this double-tax until they repatriate the profits back to the U.S.
By seeking to take away these double-tax band-aids without lowering the corporate rate substantially or fixing the global taxation scheme, Obama's proposal will shove jobs and capital out of America and into foreign countries. Obama's budget and Congressional tax-writers have been clear -- they want companies to pay the full corporate rate as soon as the international profit is earned. In a global economy, companies don't have to take this lying down. It's a relatively simple matter for a U.S. company with an Irish subsidiary to become an Irish company with a U.S. subsidiary. The Obama plan will force thousands of companies to make this job-killing decision. Companies that export goods will soon start exporting jobs.
The U.S. should tax our companies the way the rest of the world taxes theirs -- territoriality. The rest of the developed world has figured this out: if they want to retain jobs and capital in their countries, they have to adopt territoriality. This means that companies only pay corporate income tax in the country where the profit is earned. The U.S. partially tried this in 2005, when companies were allowed to repatriate deferred foreign earnings at a 5.25% rate -- far lower than what they would have to pay otherwise. The result was a one-year infusion of $318 billion in capital to the United States, resulting in $17 billion in additional corporate income tax payments, and the creation of thousands of new jobs.
The U.S. needs to lower our corporate income tax rate to become more competitive. American employers are competing globally with Irish, British, German, etc. companies. It makes no sense to saddle our employers with the highest corporate rate in the world. At the very least, we need to lower our corporate tax rate to 25 percent or less. This simply begins to make our tax treatment of large employers somewhat comparable to our European competitors. When combined with territoriality, this move would begin to change the corporate tax culture in the U.S. from a jobs killer to a jobs magnet.
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