Report: Lower corporate tax rate would boost retail jobs

Lowering the corporate tax rate could lead to the creation of more retail jobs, better pay and lower prices across the industry, according to a report released Wednesday. 

Tackling comprehensive tax reform that includes a reduction in rates for businesses would create 327,000 jobs and help boost capital investment, according to a PricewaterhouseCoopers report commissioned by the Retail Industry Leaders Association (RILA).

“With one in five American jobs reliant on retail, the industry is one of America’s most powerful economic engines," said Kirt Johnson, RILA's vice president for tax policy. 

"However, the retail industry’s treatment under the current tax code belies its prominent place in the economy and stifles job creation, investment and consumer savings.” 

The report finds that a hypothetical tax reform plan that lowers the corporate tax rate to the current average of 26.6 percent would result in annual savings of more than $10 billion to the retail industry. 

Congress and the White House are starting talks on tax and spending issues with the aim of crafting a broader package next year that could include a lower corporate tax rate. President Obama has said in the past that he would like to lower the 35 percent business rate. 

The report determined that retailers pay the highest effective tax rates of 36.4 percent, more than 10 percentage points above the average for all other industries.

The industry employs 17.8 million making retailers the nation's second-largest private employer.

In addition, 10 million more jobs within other sectors, such as finance, transportation and manufacturing, are reliant on the retail industry. 

“RILA supports comprehensive tax reform that broadens the base and substantially lowers the corporate tax rate, and treats all industries the same. Doing so will free retailers to invest, expand their businesses, and most importantly, create new jobs,” Johnson said.