Washington, DC - Today, Ways and Means Committee Chairman Dave Camp (R-MI) and Senate Finance Committee Ranking Member Orrin Hatch (R-UT) sent a letter to heads of the Business Roundtable and the National Federation of Independent Business (NFIB) responding to the President Obama’s call for a corporate tax reform only approach to tax reform as a means of averting the fiscal cliff. In the letter, the two reaffirmed their support for comprehensive tax reform and noted that, “Reforming some portions of the tax code but ignoring others will not only leave the code entangled with provisions that restrict businesses, but it will leave out a huge sector of job creators, threatening to further hamper our economic recovery."
Below is the full text of the letter:
Dec. 14, 2012
James McNerney, Jr., Chairman Business Roundtable
300 New Jersey Avenue, NW, Suite 800
Washington D.C. 20001
Dan Danner, President National Federation of Independent Business
53 Century Blvd, Suite 250
Nashville, TN 37214
Gentlemen:
We are writing to express our concern about recent comments from members of the business community regarding tax reform and the ongoing negotiations over the so-called “fiscal cliff."
As you are aware, 10 months ago the White House proposed a rough outline of how to overhaul the tax code for corporations without reforming it for individuals and small businesses. Some now report that the Administration is seeking a corporate-only tax reform approach as part of the fiscal cliff negotiations, and certain members of the business community appear eager to support such an exercise. We believe, however, that pursuing corporate tax reform as a separate measure while addressing the deficit through tax increases on small businesses would hinder comprehensive tax reform efforts and do serious harm to small businesses throughout the country.
Many small businesses - including partnerships, LLC’s, and S corporations - are taxed under the individual tax rate structure, with income from these entities flowing through to the individual owners’ tax returns. As a result, these businesses will face significant tax hikes under a central component of President Obama’s proposal: raising the top two individual marginal tax rates. According to the Joint Committee on Taxation, 53 percent of all flow-through business income would be subject to higher tax rates under the President’s proposal. These employers - often the businesses we find along the Main Streets of our hometowns - need and deserve tax reform as much as any large corporation.
Make no mistake, we believe that it is vital that we reduce the corporate tax rate and reform our international tax rules to encourage economic growth, improve our nation’s competitiveness, and, most importantly, to create jobs. However, such growth and job creation will not come from corporate tax reform alone. Reforming some portions of the tax code but ignoring others will not only leave the code entangled with provisions that restrict businesses, but it will leave out a huge sector of job creators, threatening to further hamper our economic recovery.
Furthermore, the practical reality is that there simply is not enough money on the individual side of the tax code to achieve the size of tax increases the President is seeking. In endorsing the President’s push for higher tax rates, you are also risking some of your own top priorities for tax reform - such as shifting from a worldwide to a territorial system and bringing our corporate rate in line with the OECD average.
The President’s latest gambit is clearly meant to divide the business community on the issue of tax reform. As Chairman of the House Ways and Means Committee and Ranking Member of the Senate Finance Committee, we urge business groups and the companies they represent to remain united in their support for comprehensive tax reform that benefits not only large companies and corporations, but small businesses as well.
Thank you for your attention regarding this important matter.
Sincerely,
CAMP HATCH
cc:
A.O Smith Corporation ABB Inc.
Abbott Laboratories ACE Group ADP AES Corporation Aetna AGCO AK Steel Corporation Alcoa Altec, Inc.
American Express Amerigroup Ameriprise Financial Apache Corporation Arch Coal, Inc.
AT&T Avery Dennison Corporation Avis Budget Group Ball Corporation Bank of America Bausch & Lomb Incorporated Bayer AG Bechtel Group, Inc.
BlackRock BNSF Railway Boeing BorgWarner Inc.
Brinks Company C. V. Starr & Co., Inc.
Caesars Entertainment Campbell Soup Company Cardinal Health Caterpillar CBRE, Inc.
CF Industries Holdings, Inc.
CH2M Hill Companies, Ltd.
Chesapeake Energy Corporation Cigna Corporation Citigroup Cognizant Comcast Convergys Corporation Corning Incorporated Crane Co.
CSC CSX Cummins Inc.
CVS Caremark Darden DaVita HealthCare Partners Inc Deere Dell DIRECTV, Inc.
Dow Chemical Duke Energy Corporation DuPont Eastman Chemical Company Eaton Corporation PLC Eli Lilly and Company EMC Corporation Exelis Express Scripts Exxon Mobil FedEx Fifth & Pacific Companies, Inc.
First Solar Fluor Corporation FMC Corporation Freeport-McMoRan Copper & Gold Frontier Communications Corporation Gannett General Electric Goldman Sachs Group Grant Thornton LLP Harman International Industries, Inc.
Harris Corporation Hasbro, Inc.
Hertz Global Holdings, Inc.
Honeywell International Humana Ingersoll Rand International Franchise Association International Paper ITC Holdings Corp.
ITT Corporation J.P. Morgan Chase & Co.
Johnson & Johnson Johnson Controls Kelly Services, Inc.
Kindred Healthcare KPMG Liberty Mutual Insurance Group Marathon Oil MassMutual Financial Group MasterCard McDermott International, Inc.
McKesson Medtronic, Inc.
Merck Meredith Corporation Meritor, Inc.
NASDAQ OMX National Association of Manufacturers National Association of Wholesaler-Distributors National Gypsum Company Navistar NextEra Energy, Inc.
Norfolk Southern Corp.
Northrop Grumman Nucor Corporation Owens Corning PepsiCo Pfizer PG&E Corp.
Phillips 66 Praxair Inc.
PricewaterhouseCoopers International Limited Principal Financial Group Procter & Gamble Qualcomm Incorporated R R Donnelley RATE Coalition Realogy Holdings Corp Rockwell Automation Rockwell Collins Ryder System, Inc.
S-Corp Coalition Sanofi SAP AG SAS Sealed Air Corporation Siemens Corporation Stanley Black & Decker Inc.
State Farm Insurance Cos.
Suffolk Construction Company SunGard Target Tenet Healthcare Corporation Tenneco Inc.
Textron Inc.
The Hartford The McGraw-Hill Companies The Travelers Companies The Williams Companies Time Warner Tishman Speyer TransCanada Corporation Tyco United Technologies Universal Health Services, Inc.
U.S. Chamber of Commerce Verizon Communications Viacom Inc.
Visa Inc W.W. Granger, Inc.
Wal-Mart Stores WellPoint WESCO International, Inc.
Weyerhaeuser Company Whirlpool Corporation Windstream Corporation World Fuel Services Corporation Wyndham Worldwide Corporation Xerox Corporation Ways and Means Republican Press Office
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