The President Barack Obama Administration unveiled a corporate tax reform plan on February 22, lowering the top income-tax rate for corporations while eliminating deductions, Fox News reported.
According to the news outlet, the top income-tax rate, if the plan is adopted, will drop from 35 percent to 28 percent for corporations, and firms with overseas operations will also now face a minimum tax on their foreign earnings. This would work in conjunction with new tax benefits for U.S. manufacturers to provide incentives for keeping work in America.
This new tax plan aims to raise $250 billion over 10 years, as money would come from firms like oil and gas companies, which would lose many large deductions and subsidies along with paying a higher amount of taxes.
"Our tax system should not give companies an incentive to locate production overseas or engage in accounting games to shift profits abroad, eroding the U.S. tax base. Introducing the principle of a minimum tax on foreign earnings would help address these problems and discourage a global race to the bottom in tax rates," according to an outline provided by a senior official from the Administration.
Bloomberg reported that the new tax code, if adopted, will still include incentives for research and development and renewable energy.