Monday, May 11, 2009

Required Reading

Robert Samuelson absolutely eviscerates Obama's "crack down on corporate tax cheats" speech in today's WaPo. Here's the closer, but go read the whole thing:

Including state taxes, America's top corporate tax rate exceeds 39 percent; among wealthy nations, only Japan's is higher (slightly). However, the effective U.S. tax rate is reduced by preferences -- mostly domestic, not foreign -- that also make the system complex and expensive. As Hufbauer suggests, Obama would have been better advised to cut the top rate and pay for it by simultaneously ending many preferences. That would lower compliance costs and involve fewer distortions. But this sort of proposal would have been harder to sell. Obama sacrificed substance for grandstanding.

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