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Posted by: Maricopa Lawyers on Aug 2, 2013

In Washington, there is a new effort to lower corporate taxes, alongside new domestic spending. President Obama spoke Tuesday in Chattanooga, Tennessee about how corporation taxes were high on his list of things to do regarding federal spending for 2014. Another one of the issues on his table is the country’s debt ceiling, an issue which must be resolved within the coming months.

 

Part of the corporate tax overhaul includes working with congress to appease them by including a one-time revenue gain used to build new infrastructure, which would be good for the economy.

Obama claims that this new measure is aimed at simplifying taxes and helping those in the middle class get jobs. Although the specific details were unclear regarding changes in the tax code, Republicans seem open to the idea, and claim it could be helpful in constructing a budget deal. People in both parties are looking to create a more competitive tax system for corporations.

Although the proposal has bi-partisan supporters, opposing viewpoints note the exclusion of small businesses, which could hurt American families. Some smaller-sized company owners claim that this measure leans in favor with the bigger entities, not them.

As part of the new measure, there will also likely be changes regarding different areas of the tax code, including international taxation. Currently, most entities can avoid a large federal taxation when doing business abroad, as long as the money stays outside the US. This has led to enormous stockpiles of money being kept offshore by companies looking to evade taxation.

Obama’s proposal would require these businesses to pay out a certain low tax rate on international profits, to encourage them to bring that wealth back to the states. This is likely the start of the US ending taxation on overseas profits altogether.