I support comprehensive tax reform to get Americans working again and our economy back on track. Independent economists estimate that, when coupled with reduced federal spending, comprehensive tax reform could lead to the creation of 1 million jobs in the first year alone. If we are serious about creating a climate for job creation, now is the time to adopt tax policies that empower American companies to become more competitive and make the United States a more attractive place to invest and create the jobs this country needs.
Where I stand on taxes
Expanding the tax base through reform, not rate increases, is the best way to increase revenue and spur the economy: More taxation, regulation, and litigation will not create more jobs. Research shows that increasing marginal tax rates reduces incentives to work, save and invest, consequently reducing economic output. Instead, we should adopt reforms that keep rates low by expanding the tax base. That base can be expanded in two ways: By increasing economic output, thereby creating more taxable income; and by removing narrowly tailored credits, deductions and loopholes that only benefit a handful of companies or people, thereby opening up more revenue streams. In either case, we can keep rates low to encourage economic growth.
We must simplify the current tax code to make it simpler, flatter and fairer: America's tax code is mind-numbingly complicated, and it is fundamentally unfair. It is filled with loopholes and giveaways in the form of myriad deductions and credits, and American businesses are burdened by the highest corporate tax rates in the Western world. I support lowering the corporate rate from 35 percent to 25 percent to make the U.S. a more attractive place to invest and create jobs. Additionally, I support consolidating the current six individual income tax brackets into far fewer, so that the tax code is simpler, flatter and more predictable. Finally, comprehensive tax reform would include eliminating special-interest carve outs and loopholes to make the code fair for all.
We should shift to a territorial system that will put American companies on a level playing field with foreign competitors: The U.S. currently has an antiquated system of international taxation, whereby U.S. companies pay foreign taxes on income earned abroad, and then U.S. taxes when the profits are repatriated to the U.S.--essentially taxing them twice. Moving to a territorial tax system would subject U.S. companies only to the tax system of the country where their income is earned, hence boosting competitiveness and encouraging companies to come back to the U.S. to invest and create jobs.