Coats Statement on President Obama’s Call for Tax Reform

“While the president’s plan focuses only on corporate tax reform, I believe we need to restructure the tax code to make it work better for all Americans, including manufacturers, small businesses, farmers and especially hard-working families.”

WASHINGTON, DC – Senator Dan Coats (R-Ind.) made the following statement regarding the tax reform proposal released today by President Obama that would lower the top corporate tax rate from 35 percent to 28 percent and close tax loopholes:

“Since returning to Congress, I have called for bipartisan comprehensive tax reform as a way to generate economic growth and reduce the debt, and I am glad the president finally is focusing on this important issue.

“While the president’s plan focuses only on corporate tax reform, I believe we need to restructure the tax code to make it work better for all Americans, including manufacturers, small businesses, farmers and especially hard-working families. Reforming and simplifying the tax code for both businesses and individuals is the best way to grow the economy and create more American jobs. In order to make our make country stronger in the global marketplace, we must do more than lower our top corporate tax rate to 28 percent.

“Senator Wyden and I have teamed up on a bipartisan proposal that would create a simpler and fairer tax system and lower the corporate tax rate to 24 percent. Our proposal would allow American companies to invest in job creation here at home by bringing foreign earnings trapped overseas back at a reduced rate.

“The Wyden-Coats plan should be the starting point for the much-needed tax reform debate in Congress. I look forward to working with the administration so that we can move beyond simply talking about the benefits of tax reform and produce a bill that can pass the House and Senate.”

Last year Senator Coats and Senator Ron Wyden (D-Ore.) introduced the Bipartisan Tax Fairness and Simplification Act of 2011, the first bipartisan, comprehensive tax reform bill in the last quarter century. The Wyden-Coats legislation would simplify the tax system, hold down rates for individuals and families, provide tax relief to the middle class and create incentives for businesses to grow and invest in the United States.

For individuals: Wyden-Coats reduces the number of individual tax brackets from the current six to three: 15 percent, 25 percent, and 35 percent and eliminates the Alternative Minimum Tax completely.  Middle-class and low-income taxpayers will benefit from Wyden-Coats’ near tripling of the standard tax deduction, which will not only reduce tax bills but relieve Americans of the stress and responsibility of maintaining the records and receipts needed to document itemized deductions. These simplifications alone will make it possible for most taxpayers to file a simple one-page 1040 form that most Americans will be able to fill out in less than an hour. 

For businesses: Wyden-Coats takes steps to level the playing field and make investment in the United States more attractive to businesses of all sizes. To encourage small business growth, more than 95 percent of small businesses – those with gross annual receipts of up to $1 million – will be able to permanently expense all equipment and inventory costs in a single year.  Wyden-Coats also makes American companies more competitive by reducing the top corporate tax rate and replacing the existing six corporate rates and eight brackets with a single flat rate of 24 percent.  Currently, U.S. corporations pay the second highest tax rate among industrialized countries.  Under Wyden-Coats, companies investing in the United States would pay less than they would in Canada, Germany, France and many other U.S. trading partners. 

Read more about the Wyden-Coats plan here and here.

# # #