Friends of Manufacturing

Cutting the corporate tax rate is worth the cost, Feldstein argues

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The U.S. Congress is close to enacting a major tax reform. The plan’s most important provision reduces the corporate tax rate from 35% to 20% — from the highest among all OECD countries to one of the lowest — and allows U.S. companies to repatriate the profits of their foreign subsidiaries without paying additional U.S. taxes. 

Opponents of the legislation point to the resulting increase in the federal budget deficit, which will add $1.5 trillion to the government debt over the next 10 years.

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