The chairman of the tax-writing U.S. House Ways and Means Committee wants to lower the top individual and corporate tax rates to 25 percent from 35 percent, his spokeswoman said.
Representative David Camp, a Michigan Republican, “will push for a top rate of 25 percent for corporate and individual tax rates,” Michelle Dimarob, the committee’s spokeswoman, said in an e-mail yesterday.
Camp has long discussed an overhaul of the tax system that would involve lowering rates and broadening the tax base, and his committee has begun holding hearings on the subject.
“I really just want to set a goal out there and start the discussions and talk about everything,” Camp told reporters today.
He hasn’t advanced a specific proposal, presented a timeline for action or said which tax breaks would be eliminated as part of an overhaul of the Internal Revenue Service code.
Until now, Camp hadn’t identified a specific target for the top rate. The Wall Street Journal reported his plans yesterday.
Tax Code Overhaul
Senate Finance Committee Chairman Max Baucus said today that he supports a corporate rate cut, combined with the elimination of deductions and exclusions, to help U.S. companies compete against overseas rivals. The Montana Democrat didn’t identify a specific rate. Baucus also wouldn’t comment on Camp’s 25 percent target rate for individuals.
“That’s a whole separate subject,” he said. “As I said, I’m only addressing corporate.”
In his State of the Union address on Jan. 25, President Barack Obama said he wants to lower the corporate tax rate and broaden the base and that he is open to discussions about the individual tax code. Obama has said any cut in the corporate rate must be accompanied by reducing or eliminating tax breaks, so that an overhaul wouldn’t increase the budget deficit.
Republicans, including Camp, have said discussions about revamping the corporate and individual codes should occur together, in part because many businesses are taxed at individual rates and would suffer if they lost deductions without a corresponding rate drop.
Dimarob said that to achieve the goal of a 25 percent tax rate, “Camp will seek to eliminate necessary deductions to ensure American families and employers of all sizes have a tax code that is simpler, provides more certainty, and unlocks the job creation we need to move the economy forward.”