ACC610 Week 1 Discussion 2 Corporate Tax Reform

Week 1 - Discussion 2

• Do you think any of these obstacles can be overcome? If so, which ones and how?

Some of these challenges may be surmounted, naturally, particularly if the appropriate action is taken, keeping the relevant people in mind, for the simple reason that any changes will have repercussions beyond the corporate level, even though the entities in question are corporations.

10. Not Enough “Loopholes” to Close: If corporate tax rates are lowered to 25%, then steps should be taken to close any remaining tax “loopholes” that allow corporations to pay less or no tax.

Lastly, I’m afraid I disagree with point five, which is that corporate reform must be linked to individual reform. The middle class and the poor should not have to pay for tax reform. Therefore, many politicians, especially so-called “conservatives” who are always eager to plunder the poor to enrich the rich, would have no basis for running for office.

• How does the influence of special interest groups affect the country’s ability to pass comprehensive tax reform?

Various external factors can impact tax reform, and particular interest organizations are a significant force in shaping laws. They use political parties and candidates to advance policies that serve their interests. Groups like these would collaborate with political groups to not only watch out for their interests if there was equity in what was vital for society and the individual.

• If corporate tax reform involved lowering tax rates in exchange for reducing or eliminating certain deductions, what effect do you think this would have on large and small corporations?

As was said above, the reduction in the tax rate from 35% to 21% for pass-through corporations is an incentive for enterprises to maintain and grow their operations in the United States while remaining competitive internationally. With this rate reduction in mind, businesses of all sizes can strive to be more efficient to save money and boost profits. Companies would have looked elsewhere to set up shop if the deduction had been lowered or withdrawn, which would have been bad for the economy of the United States.

References

Sullivan, M. (2014, February). Top 10 reasons there is no corporate tax reform (Links to an external site.)Links to an external site. Forbes. Retrieved from http://www.forbes.com/sites/taxanalysts/2014/02/05/top-10-reasons-there-is-no-corporate-taxreform/