WASHINGTON Nov 16 Business executives in a
survey released this week named three corporate tax breaks they
would be willing to live without in return for a reduction in
the U.S. corporate income tax rate.
The three were accelerated depreciation, the domestic
production deduction and the research and development credit,
the poll of 680 executives found. It was conducted from July to
September by Big Four accounting and audit firm KPMG LLP.
The survey comes as Congress and President Barack Obama edge
toward overhauling the tax code for the first time in 26 years,
with all the controversy and conflict such a project brings.
Tax reform has widespread support. Most of the executives
polled said the corporate tax code has flaws and needs reform.
But tax reform means different things to different people.
Some want a fairer code, some want a simpler one, some want
lower rates, some want all of the above. Everyone seems to want
tax reform, in some way, to help reduce the federal deficit.
The survey respondents cited complexity as the top flaw in
the tax code.
Corporate tax breaks annually cost the Treasury about $100
billion. The U.S. budget deficit is $1.1 trillion. So ending all
corporate tax breaks would cut the deficit, but not by much.
The code's big loopholes help average people. For instance,
the mortgage interest deduction alone costs $100 billion a year.
The three identified by the executives in the survey
deprived the Treasury of $46 billion in 2012. Accelerated
depreciation lets companies write off new equipment more quickly
than usual, which reduces their tax bills. The domestic
production deduction lowers the taxes of companies with U.S.
manufacturing. The R&D credit helps companies doing research.
Corporations spend heavily on lobbyists to protect tax
breaks central to their businesses. The Obama administration
wants to cut a major tax deduction now used by oil and gas
companies. The president has also proposed that companies with
major international components pay a minimum tax on their