70% of Manufacturers Pay Income Taxes at Individual Rates: Do You Understand this Obama? Romney?
Yes. According to the National Association of Manufacturers:
> 70 percent of manufacturers pay income taxes at individual rates. Therefore, any tax increase on individuals is a tax increase on manufacturers.
This means every time Obama talks about raising individual rates he would be increasing taxes on manufacturers and killing jobs.
In addition, since so many manufacturers are paying at the individual rate, inheritance taxes can force families to break apart, sell, or close their family’s manufacturing business. Therefore, the National Association of Manufacturers wants to:
Institute permanent lower tax rates on estates to protect family manufacturing businesses
Republicans needs to consider what this means:
Romney refuses to lower individual rates, so he is keeping rates on manufacturers high- companies we need to create jobs. He also only reduces the corporate rate to match Europe’s rate of 25%.
Santorum eliminates the corporate tax on manufacturing–but only 30% of manufacturers, the corporate ones, would immediately benefit. (And many of these are very good at avoiding taxes. Right GE?) Although over time, reducing the high corporate rate might encourage corporations to stop avoiding the US for their manufacturing facilities. Santorum taxes individuals at 28% which better than the current 35%.
Gingrich’s plan to give every individual the option to pay a 15% flat tax helps the 70% of manufacturers who pay at the individual rate and gives them a big boost. He also reduces the corporate rate to 12.5% which should encourage corporations to locate here (obviously not as much as Romney’s 0% on Corporations but Santorum would tax manufacturers who pay the individual rate 28% as opposed to Gingrich’s 15%)
Also, unlike other parts of the world, the US taxes corporate earnings from overseas. As the National Association of Manufacturers states it:
The United States is unique among major industrial nations in taxing a company’s global income.
To their credit, each Republican candidate supports changing tax law so US manufacturers are no longer at such a large disadvantage.
The Obama administration, on the other hand, fails to recognize the following facts:
95 percent of consumers live outside the U.S., making it critical for manufacturers to have access to global markets through free trade agreements.
Currently, there are dozens of free trade agreements being negotiated around the world, but the U.S. is a party to just one.
The Obama Administration’s failure to act is devastating:
Over the past three years, the United States has amassed a $70 billion manufactured goods trade surplus with countries with which we have free trade agreements. During that same time, the U.S. ran a $1.3 trillion deficit in manufactured goods with countries that do not have trade agreements with us.
The sum-up the situation very clearly:
Through inaction on free trade agreements, we are ceding market share to our competitors.
Manufacturers are also solidly against ObamaCare (and why would RomneyCare at the state level be any better?) They are very direct:
Repeal the 2010 health care law.
In addition to the points made in this post, the National Association of Manufacturers describes how:
The National Labor Relations Board is killing manufacturers.
Government regulators are NOT required to administer regulations using the lowest cost impact.
How lawsuits are used as defacto regulation and how lawsuits add 2% more to the cost of manufacturing in the US compared to the rest of the world. This may not sound like much, but keep in mind that it is estimated that Wal-Mart destroyed their competitors with only a 1% cost advantage.
So while Obama and Romney want to keep individual tax rates the same. If we want to help the 70% of US manufacturers who pay at the individual rate grow create jobs, Obama and Romney are the wrong answer. Maybe this lack of understanding is why Obama hung out with Radicals and why Romney voted for a Democrat Presidential candidate in 1992.