By Rep. Charles W. Boustany Jr. (R-La.) - 03/16/10 10:05 PM EDT
We need these commonsense solutions that allow American workers to find a good job and businesses to grow. Instead of rubber-stamping more than a trillion dollars in deficit spending, Congress must find ways to help entrepreneurs and restore American competitiveness. Isn’t that the kind of stimulus and certainty American families really need?
America’s job creators suffer under a tax code that is too complex, too expensive and fails to provide the stability employers need to hire and grow with confidence. The IRS estimates small-business owners spend nearly 1.8 million hours and upwards of $17 billion a year to comply with ever-changing tax laws.
Congress holds employers of all sizes hostage each year as lawmakers haggle over extending tax incentives critical to business decisions like hiring and investment. Certainty in our tax system will spur job creation and encourage taxpayers to work, save and invest.
An important first step must be making the 2001 and 2003 tax relief measures permanent, including marginal rate reductions and capital investment incentives that create jobs by promoting long-term growth. Small businesses rely on these tax cuts to provide necessary capital to expand, hire new workers and compete globally. Without this capital, small companies can be paralyzed.
The nonpartisan Congressional Budget Office estimates the economy will grow faster if Congress extends all of the 2001 and 2003 tax reforms. Yet, President Barack Obama plans to let tax relief expire this year. This directly hurts small businesses — which created 80 percent of the new private-sector jobs in the down economy.
Congress should also pursue additional growth-oriented tax policies to put Americans on fair footing abroad. Lowering corporate tax rates will help U.S. businesses compete in fast-growing world markets and increase foreign investment within our own borders, putting Americans back to work.
One example, Louisiana-based Tidewater Inc., employs more than 800 Americans, mostly along the Gulf Coast. Providing energy production services here at home and around the world, Tidewater capitalizes on American ingenuity to produce the energy we all use. Uncertainty for companies like Tidewater hampers expansion and job creation and hurts Louisiana workers.
The U.S. charges a higher statutory corporate tax rate than all countries but Japan. American companies operate under a convoluted tax system that encourages them to keep profits overseas to remain competitive. President Obama’s proposed tax hikes will further hurt U.S. businesses competing around the world and threaten the jobs they support here at home.
The Business Roundtable reports U.S.-based companies that do work here and abroad employed over 19 percent of all private-sector American workers in 2007, with an average salary 24 percent higher than other private-sector counterparts. Instead of putting a target on the backs of these U.S. job creators, it’s time to rework the tax code to ensure American businesses can compete on a level playing field in the global economy.
Along with the overly cumbersome tax code in the United States, American workers continue to face enormous obstacles overseas. With 95 percent of the world’s consumers living outside the U.S., our ability to compete fairly and successfully in these markets is vital to our long-term economic growth and security.
I welcome President Obama’s lofty goal of doubling U.S. exports in the next five years through his National Export Initiative. As our economic struggles continue, Americans will not be able to “consume” their way back to prosperity, so we must focus on selling our products and services around the world.
According to the Obama administration, increasing trade by merely 1 percent would create 250,000 jobs, a significant start to helping Americans find work. Passing the Colombia, Panama and South Korea free trade agreements would accomplish just that, instead of alienating our global trading partners through narrow-minded policies such as “Buy American.”
If given certainty and opportunity, American workers and companies can compete successfully in any market. Those opportunities will only be available if Congress passes meaningful tax reform and the administration aggressively engages our trading partners in a constructive manner.
Creating new, long-term American jobs requires ending uncertainty from Washington and unleashing our creative genius. The world will simply not wait for us to wake up and realize the opportunities that exist.
Boustany is ranking member of the Ways and Means Oversight Subcommittee.