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Corporate Taxes

Romney :

Mr. Romney believes that the U.S. corporate tax rate of 35%, which is among the highest in the industrial world, reduces the ability of U.S. businesses to compete in the global economy and to invest and create jobs at home (

He proposes to cut the corporate tax rate from 35% to 25%, strengthen and make permanent the R&D tax credit, repeal the corporate Alternative Minimum Tax, and switch to a territorial tax system - income is taxed only in the country in which it is earned. Since most small businesses are organized in a manner that passes through earnings to the owners who are then taxed at personal income levels, Mr. Romney's proposed 20% cut in marginal tax rates would benefit those business owners directly.

Obama :

President Obama proposes to reduce the corporate tax rate from 35% to 28% while closing loopholes. Incentives to manufacturers would effectively lower their rate to 25%. He also proposes a minimum tax on corporations's overseas earnings and oil and gas companies would lose many deductions and subsidies.

He proposes allowing small businesses to expense up to $1 million in investments, and allowing cash accounting on businesses with up to $10 million in gross receipts. In the budget he proposed providing tax cuts for small businesses that increase their hiring or make new investments, doubling the deductions for startup costs, and reforming and expanding the health insurance tax credit (Associated Press May 15, 2012).

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