Nunes legislation would reform business taxes

The system for taxing businesses could be overhauled as a result of legislation introduced this week by U.S. Rep. Devin Nunes (R-CA).

Nunes, a member of the Ways and Means Committee, introduced the American Business Competitiveness Act (ABC Act), supported by 26 cosponsors, to drastically simplify U.S. business tax code through the elimination of the income tax on businesses. The tax would then be replaced with a cash flow tax.

The bill’s four main provisions include allowing for 100 percent, same-year expensing for business investments, setting a maximum 25 percent business tax rate, eliminating all loopholes and special deals on business taxes, and switching to a territorial international system.

“These simple rules will revolutionize the system for taxing businesses,” Nunes said. “The expensing provision and the low rates will create a huge incentive for businesses to invest money to expand their operations. Meanwhile, by treating all businesses the same regardless of their size or how they’re organized, we’ll create a level playing field for startups and small businesses to compete with bigger firms.

“Additionally, we can expect huge sums of money parked abroad to flow back into the United States thanks to the switch to a territorial system. These factors combined will essentially turn the United States into a giant tax haven, jolting the economy in a way we’ve never seen before.”

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