Goldman CEO: I'll pay 5 percent more tax for budget deal
WASHINGTON (Reuters) - Goldman Sachs Chief Executive Lloyd Blankfein on Thursday became the latest big-name business leader to pledge to pay a steeper tax rate - 5 percent more, he said - in exchange for a long-term bipartisan deal in Congress to keep the country from falling off the "fiscal cliff."
Blankfein is part of a group of corporate executives who have raised nearly $30 million to support a deal to avoid the nearly $600 billion in tax hikes and spending cuts set to take effect at the end of the year.
Asked if he would pay 5 percent more in taxes if it became necessary for Congress to reach a deal, he said "Of course ... I don't know anybody who wouldn't."
Blankfein, who characterized his political views as "center left," was interviewed Thursday along with Erskine Bowles and Alan Simpson on CNBC.
Blankfein also said there would be a "huge" positive impact on the economy if a bipartisan compromise were reached.
"I'd be a buyer of the market," he said.
Simpson and Bowles were co-chairs of a bipartisan commission established by President Barack Obama that in December, 2010 came up with a comprehensive proposal to reduce the budget deficit, which has been topping $1 trillion for several years.
The commission's report has some support among Democrats and Republicans as a deficit-reduction model, though when it was initially proposed, Obama did not act on it and most House Republicans opposed it.
Both Simpson and Bowles have been traveling the country with the corporate group to push for a similar proposal.
They are also trying to sway a group of Senators known as the "Gang of Eight," - four Democrats and Republicans each, who are working on a bipartisan deal and have embraced the model.
Despite the push for a broad deficit-cutting deal to avoid the fiscal cliff, Congress has put off any decisions until after the November 6 presidential and congressional elections.
That will leave lawmakers only a few weeks to act before the automatic cuts and tax increases are triggered under a budget law passed by Congress in 2011.
Budget and tax issues are expected to be among the big issues addressed during Thursday night's vice presidential debate.
DIVERSE BUSINESS GROUPS
The business community, while eager for lower taxes, splinters over the specifics of which tax breaks to eliminate.
More than half of all businesses are not corporations like Goldman Sachs, but are organized so they pay taxes at individuals' rates. These include small businesses, as well as bigger firms like law firms and hedge funds.
"Everyone is more comfortable giving away someone else's money," said Dirk Von Dongen, president of the National Association of Wholesalers and Distributors, whose make-up includes 60 percent of pass-through businesses.
Another skeptic is Brian Reardon, a former economic adviser to Republicans and now head of a trade group lobbying for such businesses.
"The challenge with that assumption is it assumes you raise rates and get more revenues that is going to go to deficit reduction," Reardon said.
The corporate tax rate is not changing at the end of the year, though most individual income taxes could increase. Both Obama and Republican challenger Mitt Romney support lowering the top 35 percent statutory rate.
(Reporting By Kim Dixon, with additional reporting by Lauren LaCapra. Editing by Fred Barbash, Gunna Dickson and Dan Grebler)
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