Wednesday, November 30, 2011

Portman not giving up on tax reform (Politico)

A week after the supercommittee?s collapse, Sen. Rob Portman said Monday he?ll unveil a corporate tax reform plan early next year that builds off a framework negotiated by the failed bipartisan deficit panel.

The Ohio Republican, one of 12 members of the supercommittee, described his plan as ?pro-growth, deficit neutral,? and said it would drop tax rates to 25 percent, broaden the tax base and move to a ?territorial system? where only profits earned in the U.S. would be taxed here.

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The freshman senator said he?s hopeful he?ll find Democratic partners for his proposal, including Sneate Finance Chairman Max Baucus (D-Mont.), another supercommittee member.

In the coming year, ?there is a good possibility for reform,? Portman said during an event at the American Enterprise Institute, a conservative think tank in Washington. ?I?m disappointed what happened with the supercommittee, but more determined than ever to address these issues.?

While didn?t go into much detail, Portman said his plan would cut the top corporate tax rates to 25 percent from 35 percent, primarily by reducing inefficiencies, preferences and exemptions. It would closely resemble the tax reform blueprint mulled by the supercommittee, which the non-partisan Joint Committee on Taxation scored as deficit neutral.

Shifting to a territorial system would mean that profits earned by U.S. companies overseas would not be taxed, allowing firms to bring ?hundreds of billions of dollars back to these shores? without penalty, Portman argued.

Still, Democrats are concerned the change would encourage companies to ship more of their operations overseas, resulting in a narrower tax base.

For Portman, the supercommitee?s failure last week was ?profoundly disappointing.?

Portman, who was a White House budget director under President George W. Bush, faulted President Barack Obama for proposing $447 billion in additional spending for his American Jobs Act at a time the panel was charged with cutting the deficit.

And Portman pushed back against supercommittee Democrats who during deficit talks called for a ?balanced approach? that included a one-to-one ratio of spending cuts to tax hikes.

?This misses the big picture. Raising tax rates to chase soaring spending would upset a far more fundamental balance in this country ? the balance between the federal government and a free and vibrant private economy,? Portman said. ?A massive tax increase would deal a blow to the fragile U.S. economy, leading to less growth, diminished wages and fewer new jobs.

Democrats have created a ?false choice? by focusing solely on stimulus job measures while ignoring spending cuts, he said. A truly balanced approach to cutting the nation?s $15 trillion debt includes corporate tax reform, an overhaul of Medicare, Medicaid and Social Security, and non-entitlement spending cuts.

?Clearly, Washington isn?t working. The nation?s mounting debt and deficits are holding back job creation, keeping millions of Americans out of work,? Portman said. ?Another round of stimulus spending is not the answer. We?ve tried that.?

Jonathan Allen contributed to this report.

Source: http://us.rd.yahoo.com/dailynews/rss/politics/*http%3A//us.rd.yahoo.com/dailynews/external/politico_rss/rss_politico_mostpop/http___www_politico_com_news_stories1111_69235_html/43737241/SIG=11mmq9pqj/*http%3A//www.politico.com/news/stories/1111/69235.html

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