As the Senate debated its version of a tax reform bill in advance of an expected vote, tech companies including Microsoft, Apple, Oracle and Cisco, represented by industry association TechNet, were pushing for passage so the bill could be reconciled in conference with the already-passed House version.
The key is that both bills cut the corporate tax rate from 35% to 20%, a permanent cut, versus individual tax cuts that ultimately sunset. But the bill has more to like, says TechNet president Linda Moore.
“We urge the Senate to pass its tax reform bill and move forward to a conference committee where any outstanding concerns can be worked out," Moore said. "The Senate bill lowers the corporate tax rate, transitions to a true territorial tax system [currently the U.S. collects taxes on U.S. companies' overseas profits; the bill would eliminate that], allows companies to reinvest their overseas profits here at home at fair rates [repatriation rates are lower ini the Senate's bill than the House's], preserves the R&D tax credit, and leaves in place the ability of startups to compete for talent by being able to offer more ownership opportunities to their workers.
“At the end of the day, the goal of tax reform should be to maximize economic growth, job opportunities, and prosperity for the American people," she added. "Let’s continue to move forward by passing the bill out of the Senate.”
Democrats opposed to the bill took to the Senate floor to say the tax savings will go to shareholders, rather than to investments in their workers.
Sen. Cory Booker (D-N.J.) said the bill's reforms would only provide wealth to corporations, while doing nothing for middle- and low-income workers. He called the bill unfair, bad policy and bad faith.
Republicans have said their tax plan is not trickle-down economics, but that cutting taxes will increase investment, which will boost jobs and wages for workers.