Does Lowering the Federal Corporate Income Tax Rate Create Jobs? ProCon.org Launches New Website
The ongoing fiscal cliff negotiations between President Obama and Speaker Boehner have included the idea of lowering the corporate tax rate. Since 1909, when the federal corporate tax was first introduced and the uniform rate was 1% for all business income above $5,000, until today, when the top bracket has businesses with over $18.3 million in income paying 35%, Americans have debated whether or not lowering the rate results in job creation.
Would lowering one of the world’s highest statutory tax rates help drive unemployment below its current 7.7% rate? Or with $1.5 trillion in cash reserves among the S&P 500 already sitting on the sidelines, does lowering the rate make companies more profitable but no less likely to hire workers?
ProCon.org, a nonpartisan research organization devoted to critical thinking on controversial issues, debuts a brand new issue website, https://corporatetax.procon.org, and delves into the pros and cons of whether or not lowering the corporate income tax rate yields more jobs.
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.
For pros, cons, and related research on whether or not lowering the corporate tax rate yields job growth, visit https://corporatetax.procon.org/.