Rangel's Business Tax Reforms: Industry Effects by Sector
Posted: 19 Dec 2007 Last revised: 20 Feb 2008
Tom Neubig is Ernst & Young's national director of quantitative economics and statistics (QUEST) in Washington, and former director and chief economist of the U.S. Treasury's Office of Tax Analysis. Estelle Dauchy is a senior economist with E&Y's QUEST practice. The views expressed are solely of the authors and do not necessarily The authors report that the Rangel business tax reform proposal, which lowers the corporate tax rate to 30.5 percent, financed by several base broadeners, would reduce C corporations' tax liabilities by an average of 3 percent in fiscal 2017. Most major industries, except manufacturing and mining, would benefit more from the lower corporate rate than they would lose from base broadening. The Rangel proposal would increase the federal tax on noncorporate business income by approximately 9 percent due to higher tax rates on high income taxpayers, to help pay for the lower corporate tax rate and the repeal of the individual alternative minimum tax.
Suggested Citation: Suggested Citation