GREEN: U.S. Rep. Jim Renacci, R-Wadsworth, said Monday he will use his new position on the House Ways and Means Committee to lower business taxes and then pay for the cut by reducing deductions.
Speaking before a meeting sponsored by the Green, North Canton and Jackson Township chambers of commerce, Renacci said the United States can’t be competitive in attracting and keeping business with its current 35 percent corporate tax rate.
He wants that figure at 25 percent.
“The goal of the committee,” he said, “is to make sure we are revenue neutral, in other words the revenue does not go up, the revenue doesn’t go down, and also by taxpayer class we stay neutral. In other words, middle income, high income, their tax stays the same.”
Renacci, in his second term, said many other nations tax corporate profits at around 25 percent and some rates are as low as 11 percent.
“If you automatically got a tax cut of 10 or 11 percent, where would you go?” he told the group of mostly business people. “That’s one of the problems we have in the United States.”
Renacci conceded that the effective U.S. corporate tax rate is much lower because there are so many deductions, but he questioned the fairness.
“When you do that, you are picking winners and losers, so let’s just drop the rate down and eliminate the deductions.”
He declined to say which deductions will be targeted except to say they will not be solely business deductions but also deductions for personal taxes.
“The minute you put up your hand and say, ‘Here is one deduction we are looking at,’ then markets change and everything changes, so what we have agreed on Ways and Means is to not talk about it.”
Paying for the corporate tax cut would not be easy. The Tax Policy Center said the proposal would reduce the federal government’s revenue by $1.3 trillion over the next 10 years.
With Democrats controlling the Senate and the presidency, Renacci said he doubts any reform passed by Republicans in the House would become law this year, but it’s still worth doing.
“The goal of the committee is to pass tax reform by the end of the year. That’s the goal,” he said. “Now, people say, ‘Are you ever getting tax reform done?’ I would doubt that we can get something done by the end of this year, but whatever we promote by the end of the year will probably be the baseline going forward, so it’s very important to get something out. I’m not sure we will ever get anything past the Senate and the president.”
Dave Scott can be reached at 330-996-3577 or email@example.com. Follow Scott on Twitter at Davescottofakro.