(Original post)
JANUARY 21, 2011
By Jeffrey Sparshott
WASHINGTON (Dow Jones)--Treasury Secretary Timothy Geithner Friday met with think tanks, unions, universities and business groups to discuss corporate taxes as the Obama administration weighs changes to the tax code.
Geithner in a speech last week said the White House is looking for ways to encourage growth and investment while also cutting the deficit.
The Treasury secretary met Friday with representatives from 17 groups from across the political spectrum, including the American Enterprise Institute, Brookings Institution, Business Roundtable, AFL-CIO and Columbia Law School. The Treasury Department didn't provide further details.
Participants said the groups held a roundtable discussion with the secretary, with each party given a chance to express views while the Treasury pooled ideas.
"There were thoughtful comments the whole way through," said Joseph Henchman, tax counsel for the non-profit Tax Foundation. "Obviously there is a consensus for doing something about our high corporate tax rate."
The U.S. corporate tax rate is 35%, though many pay less due to credits, deductions, exclusions and exemptions. Still, the headline rate is significantly higher than other developed nations--for example, U.K. companies pay 28%, Canadian 18%, German just under 16%, Swiss 8.5% and Japanese 30%, according to OECD data.
Many companies argue the higher rate makes them less competitive, and one common idea has been to broaden the tax base by eliminating exemptions while lowering the overall rate.
But the administration also faces mounting debt and some calls to generate more revenue.
"I didn't think it was a good idea to use all or most of the money from corporate tax reform to cut rates," said Bob McIntyre, director of the liberal Citizens For Tax Justice and one of the meeting participants. "Revenue neutral reform would be a disaster."
Friday's meeting is one in a series of discussions between senior Treasury officials and outside experts. It follows by a week a gathering with chief financial officers from more than a dozen major U.S. companies.
-By Jeffrey Sparshott, Dow Jones Newswires; 202-862-9291; jeffrey.sparshott@dowjones.com