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[Debate/토론] (PC-008) Does Lowering the Federal Corporate Income Tax Rate Create Jobs?
최고관리자 | 17-08-14 11:33
The creation of the federal corporate income tax occurred in 1909, when the uniform rate was 1% for all business income above $5,000. Since then the rate has increased to as high as 52.8% in 1969, and the single rate has become eight different rates for different income levels. Today's rate for companies with over $18.3 million in income (the top category) is 35%. Throughout US corporate tax history, Americans have debated whether or not lowering the rate results in job creation.
Proponents of lowering the corporate tax rate to create jobs argue that it incentivizes job creation in the United States instead of overseas, encourages increased investment in research and infrastructure, and passes savings on to consumers through lower prices. They say that the United States already has the highest corporate income tax rates in the world, which creates a competitive disadvantage for US businesses.
Opponents of lowering the corporate tax rate to create jobs argue that it results in more profits for corporations without affecting job creation, and that unemployment rates were the lowest in recorded US history during the time when corporate income tax rates were highest. They say that lowering the rate would increase the US deficit, and that companies hire employees based on need, not because of corporate tax rates.
Pros
1. US businesses move overseas because the United States has one of the highest statutory federal corporate income tax rates in the world.
2. High corporate income tax rates encourage US companies to store their foreign earnings abroad instead of investing it into expansion and employment in the United States.
3. Lowering corporate income taxes results in increased international investment in the United States and thus more jobs.
4. The average five-year unemployment rate decreased from 1987-1991 after the United States lowered its top corporate income tax rate.
5. Raising corporate income taxes lowers worker wages, which leads to increased unemployment.
6. High corporate tax rates create uncertainty for businesses, preventing them from investing and employing more people.
7. Lowering the corporate tax rate leads to economic growth and job creation because companies have more money to invest.
Cons
1. The federal corporate income tax rates were the highest in US history when the unemployment rates were the lowest in US history.
2. A "tax holiday" in 2004, which temporarily lowered the corporate income tax rate for companies that brought back cash stored overseas, resulted in companies cutting jobs.
3. Companies hire employees because they need workers, not because of corporate income tax rates.
4. Complaints about high federal corporate income tax rates causing high unemployment are unfounded because loopholes and deductions enable many companies to pay less than the statutory rate.
5. Corporate profits in the United States are the highest they have been in 61 years, yet the federal unemployment rate is higher than most of the rest of the developed world.
6. Lowering the corporate tax rate raises the deficit, which hurts job creation.
7. Complaints about high federal corporate income tax rates causing high unemployment are unfounded because corporations are sitting on record amounts of cash.
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