Is President Obama Retreating on his Proposed Top Corporate Tax Rate of 28%?

Published by Michael Novogradac on Monday, October 29, 2012 - 12:00am

In February, the White House and Treasury Department proposed lowering the top overall corporate tax rate from 35% to 28%, a full 20% reduction in the top rate. They also proposed lowering the top corporate tax rate on manufacturing from 35% to 25%, a reduction of more than a quarter (28.6% to be more exact).

However, in the recently released 20-page pamphlet entitled “The New Economic Patriotism: A Plan for Jobs & Middle-Class Security” the President proposes:

“Reforming the corporate tax code to bring down tax rates – cutting tax rates on domestic manufacturers by nearly a quarter” (emphasis added)

Based on this document, it appears that President Obama will be proposing a top corporate tax rate on manufacturing higher than the overall top rate of 25% rate he suggested in February. The document says “nearly a quarter,” which means the overall tax rate on manufacturing will be higher than 26.25%.

Presumably this also means President Obama will be suggesting a top overall corporate tax rate of higher than 28%.

Republicans in Congress have suggested a top corporate tax rate of 25%. So it appears, the distance between Congressional Republicans and the White House, as it relates to top corporate tax rates, just got farther apart.