House Bill Aims to Grow Jobs, Cut Corporate Taxes and Avoid Sanctions

By a vote of 24 to 15, the House Ways and Means Committee moved a bill forward Tuesday that supporters hope will generate new jobs for American workers in the form of a $128 billion corporate tax cut.

"The American Jobs Creation Act does just that—creates jobs for American workers," said Bill Thomas (R-CA), Chairman of the Committee on Ways and Means and sponsor of the bill, in a release issued by the Committee. "We will protect and expand jobs for hard-working Americans."

H.R. 2896, the American Jobs Creation Act of 2003, has not been without controversy with detractors worried that it could hurt American manufacturers and despite supporter claims to the contrary, it isn’t certain to help the economy.

The Associated Press reported that, "Balancing the items that raise revenue with new tax cuts, the bill would cost $60 billion over the coming decade."

According to the Committee release, the bill:

  • Reduces the tax rate for U.S. producers and manufacturers from 35 to 32 percent;
  • Includes an across-the-board rate cut for all C-corporations with less than $20 million in taxable income;
  • Expands the size of companies exempt from the unfair corporate Alternative Minimum Tax (AMT) from $7.5 million of gross receipts all the way up to $20 million; and
  • Repeals the Foreign Sales Corporation-Extraterritorial Income (FSC-ETI) tax regime to head off $4 billion in tariffs against U.S. goods.

The tariff arose earlier this year when the World Trade Organization ruled that "a $5 billion annual tax break for U.S. exporters amounts to an illegal subsidy," the Journal reported, adding that the U.S. faces $4 billion in penalties if the tax break isn’t repealed. This new law aims to replace the old system.

You may like these other stories...

Ernst & Young 2013 audit deficiency rate 49%, regulators sayMichael Rapoport of the Wall Street Journal reported on Thursday that the Public Company Accounting Oversight Board (PCAOB) found deficiencies in 28 of the...
Some of your clients may get away to business conventions from time to time. It gives them a chance to rub shoulders with colleagues, catch up on the latest developments, and fine-tune their skills. And, when the meetings or...
PwC must face $1 billion lawsuit over MF Global adviceA federal judge on Wednesday ordered PricewaterhouseCoopers (PwC) to face a $1 billion lawsuit claiming that its bad accounting advice was a substantial cause of the...

Already a member? log in here.

Upcoming CPE Webinars

Sep 9
In this session we'll discuss the types of technologies and their uses in a small accounting firm office.
Sep 10
Transfer your knowledge and experience to prepare your team for the challenges and opportunities of an accounting career.
Sep 11
This webcast will include discussions of commonly-applicable Clarified Auditing Standards for audits of non-public, non-governmental entities.
Sep 24
In this jam-packed presentation Excel expert David Ringstrom, CPA will give you a crash-course in creating spreadsheet-based dashboards. A dashboard condenses large amounts of data into a compact space, yet enables the end user to easily drill down into details when warranted.