US Speaker for the House of Representatives Paul Ryan has warned against any moves to water down sweeping changes to the country’s tax system
In a speech to given at the National Association of Manufacturers, Ryan called for the overhaul to be completed by the end of 2017, claiming the reform is key to American economic growth and restoring business confidence.
‘We are going to get this done in 2017. We need to get this done in 2017. We cannot let this once-in-a-generation moment slip,’ Ryan said in his speech to the house. ‘Transformational tax reform can be done, and we are moving forward. Full speed ahead.’
A key reason for Ryan’s desire to complete the tax reform this year is because of mid-term elections scheduled to take place on 6 November 2018.
Chief among the reform plans is a shift to a territorial tax system. Currently, the US is one of the few countries in the world that taxes businesses on worldwide earnings once they are brought back into the country, something Ryan believes encourages companies to shift their headquarters and profits overseas.
‘We are actually unique in the world in the way we discourage capital from coming back to America and how we incentivise off-shoring jobs,’ Ryan said. ‘This is not the kind of exceptionalism we should aspire to. We must think differently, so that once again we make things here and export them around the world.’
He added that, at 35%, the US ‘currently has one of the highest corporate tax rates in the world, which is driving companies and job overseas’.
As such, he outlined plans reduce the rate and ‘eliminate many of the special interest carve-outs that litter our tax code’.
Since Republicans took control of Washington, however, the stumbling blocks impeding tax reform have mounted. Lawmakers are still mired in debate over repealing and replacing the Affordable Care Act, more commonly known as Obamacare.
They must vote on that bill before they can move on to approving a 2018 budget that would allow attentions to turn tax reform.
The biggest issue, though, could prove to be political concerns relating to the White House, which has been plagued by investigations about potential ties to Russia.
‘Right now, House and Senate tax writers are working with the Trump administration to turn these ideas into a unified Republican plan that we can all rally behind,’ he said.
