Ways and Means heard from a Harvard professor on how corporate tax revenues dropped after the 2017 tax overhaul
After GOP lawmakers and the Trump administration slashed the corporate income tax rate from 35 percent to 21 percent two years ago, corporate tax revenue as a share of gross domestic product is lower in the United States than any of 30 developed countries — with the exception of Latvia.
That’s the conclusion of Jason Furman, a Harvard University economics professor who testified before the House Ways and Means Committee Tuesday. “Corporate revenue collections are very low” both historically and compared to other advanced economies, said Furman, who served as chairman of the Council of Economic Advisers under President Barack Obama.
While there are estimates that corporate tax collections will grow slightly as a percentage of GDP in coming years, that likelihood will evaporate if business provisions in the 2017 tax law are made permanent, Furman added, chiefly those allowing more generous equipment expensing. Continue reading.