CRS Issue Statement on Business and Corporate Taxation

Donald J. Marples, Coordinator
Specialist in Public Finance

Congress has a constitutional responsibility to raise revenue to finance the federal government. This, and a continuing concern for economic performance and growth, has led to attention to business taxation in almost every Congress. The second session of the 111th Congress will likely show itself to be no exception. 

At the outset of the second session of the 111th Congress, Congressional focus will continue to encourage both short-run stimulus and long-run growth. In the first session of the 111th Congress, these discussions resulted in legislation focusing on small businesses, notably temporary extensions of bonus depreciation and small business expensing. One broader option, discussed during previous Congresses and likely to be discussed in the 111th Congress, would trade rate reductions for base broadening. Arguments for lowering the corporate tax rate include traditional concerns about economic distortions arising from the corporate tax and newer concerns arising from the increasingly global nature of the economy, while base broadening is generally viewed as increasing the fairness and economic efficiency of the tax system.


Date of Report: January 6, 2010
Number of Pages: 3
Order Number: IS40263
Price: $7.95

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