WASHINGTON (Reuters) - Republican White House candidate John McCain will promise on Tuesday to lower corporate tax rates if he wins the U.S. presidency and ease the tax burden on middle-class workers to help revive the faltering economy.
The Arizona senator, who has wrapped up his party’s presidential nomination, also would propose a simpler, alternative tax system and insist that chief executives’ pay and severance packages have shareholder approval.
“No matter which of us wins in November, there will be change in Washington. The question is what kind of change?” McCain will tell a conference for small businesses, referring to his Democratic opponent, Sen. Barack Obama of Illinois.
“Will we enact the single largest tax increase since the Second World War as my opponent proposes, or will we keep taxes low for families and employers?” he will say, according to excerpts released before his speech.
McCain will pledge to act quickly to lower corporate taxes from “the second highest in the world to one on par with our trading partners to keep businesses and jobs in this country.”
He will propose a law to allow companies to expense new equipment and technology in their first year.
He supports keeping capital gains taxes low, doubling a tax exemption for children, and phasing out the “alternative minimum tax” which he said would save some 25 million middle-class families up to $2,000 in a year.
On Monday Obama drew a sharp contrast with McCain, his opponent in the November election, accusing him of wanting to widen President George W. Bush’s tax cuts and plunge the United States deeper into debt.
He charged that McCain’s support for extending Bush’s tax cuts would allow $2 trillion in corporate tax breaks.
U.S. taxes were too complicated overhaul, McCain will say in his speech, in which he will argue for an alternative system.
“As president, I will propose an alternative tax system. When this reform is enacted, all who wish to file under the current system could still do so,” he will say.
“Everyone else could choose a vastly less complicated system with two tax rates and a generous standard deduction.”
McCain criticizes Obama for wanting to increase dividend and capital gains taxes and aiming to raise the minimum wage and link it to an index.
But he also takes aim at top corporate executives with big salaries and excessive severance packages.
“Americans are right to be offended when the extravagant salaries and severance deals of CEOs ... bear no relation to the success of the company or the wishes of shareholders,” he will say, adding that some of those chief executives helped bring on the country’s housing crisis and market troubles.
“If I am elected president, I intend to see that wrongdoing of this kind is called to account by federal prosecutors. And under my reforms, all aspects of a CEO’s pay, including any severance arrangements, must be approved by shareholders,” he will say.
Editing by Chris Wilson