The delay by Washington lawmakers in overhauling the nation’s tax code is holding back the economic benefits of enacting a series of pro-growth tax policies, according to a new study commissioned by the National Association of Manufacturers (NAM) and conducted by economists at the University of Tennessee and the University of Kansas.
The analysis focuses on the macroeconomic impact of five policy changes: a maximum corporate tax rate of 25 percent; a globally competitive international territorial tax system; full expensing for capital equipment; an enhanced and permanent policy toward research and development; and parallel changes for non-corporate pass-through businesses. According to the study, this five-pronged strategy over 10 years would:
- Increase GDP by more than $12 trillion relative to Congressional Budget Office projections;
- Increase investment by more than $3.3 trillion; and
- Add more than 6.5 million jobs to the U.S. economy.
“This study confirms what manufacturers learned the hard way—uncertainty caused by political gridlock takes a toll on the economy,” said NAM President and CEO Jay Timmons. “Comprehensive tax reform for manufacturers of all sizes is essential to unleashing the economic power of manufacturing and making the United States the best place in the world to manufacture. Our outdated and uncompetitive tax system is holding us back from competing with nations that have adopted pro-growth systems.”
For more information on the study, visit www.nam.org/taxstudy.
The delay by Washington lawmakers in overhauling the nation’s tax code is holding back the economic benefits of enacting a series of pro-growth tax policies, according to a new study commissioned by the National Association of Manufacturers (NAM) and conducted by economists at the University of Tennessee and the University of Kansas.
The analysis focuses on the macroeconomic impact of five policy changes: a maximum corporate tax rate of 25 percent; a globally competitive international territorial tax system; full expensing for capital equipment; an enhanced and permanent policy toward research and development; and parallel changes for non-corporate pass-through businesses. According to the study, this five-pronged strategy over 10 years would:
- Increase GDP by more than $12 trillion relative to Congressional Budget Office projections;
- Increase investment by more than $3.3 trillion; and
- Add more than 6.5 million jobs to the U.S. economy.
“This study confirms what manufacturers learned the hard way—uncertainty caused by political gridlock takes a toll on the economy,” said NAM President and CEO Jay Timmons. “Comprehensive tax reform for manufacturers of all sizes is essential to unleashing the economic power of manufacturing and making the United States the best place in the world to manufacture. Our outdated and uncompetitive tax system is holding us back from competing with nations that have adopted pro-growth systems.”
For more information on the study, visit www.nam.org/taxstudy.
- See more at: http://www.nam.org/Newsroom/Press-Releases/2015/01/Doing-Nothing-Costs-Us-Something/#sthash.Q5EVJRWW.dpuf
