Wrong Answer

It is important that we build on this momentum and establish a foundation for long-term, sustainable growth that will benefit American workers. During these fragile economic times, we need policies that foster growth. However, the current proposal to raise taxes on American companies that do business overseas by an estimated $200 billion over 10 years will do just the opposite. Obama wants to close down loopholes in the tax that are in place to allow Corporations to thrive and compete with the rest of the world. Companies from almost all other industrialized nations are not required to pay taxes on international revenues to their home nations. Instead, they operate under territorial tax systems in which they pay corporate income taxes only in the country where revenues are earned. The U.S. employs a worldwide tax system where earnings are taxed where revenues are earned, and then taxed again in the U.S. To compensate for this double taxation, which places American companies at a disadvantage with foreign rivals, the U.S. has created a system of accounting rules and deferrals to help maintain competitiveness. If Obama’s new proposal was to be adopted and loopholes in the current corporate tax system where closed our business would see no profit. To compensate corporations would raise the price on their products which hurts consumers and also lower wages which harms workers. With less money in the hands of workers, or consumers, and higher prices on consumer products will cause a drought in spending and only further contribute to a toileting economy. Then the extra tax collected from corporations will be spent to fix problems created by the excess taxes. In the current economic state we don’t need to be creating anymore problems to fix, we already have enough as it is.