CompTIA and TechVoice recently joined the Tax Innovation Equality Coalition. This group is a player in the ongoing tax reform debate, particularly with respect to issues facing larger tech companies.
This coalition supports:
- Implementation of a territorial tax system, which does not double tax income earned by U.S. multinational corporations overseas.
- Lowering the U.S. corporate tax rate so it is competitive with those of other developed nations.
- Equal tax treatment for any industry or type of income – including income from intangible property.
Because few of CompTIA’s members are U.S. multinational corporations overseas, we have not participated in the debate on tax reform issues of concern to multinational operations. However, our members do support lowering the corporate income tax rate, and they also support the principle that there should be equal tax treatment for any industry or type of income.
In a tax survey conducted by CompTIA last year, we found that 56 percent of respondents replied that a reduction in the corporate tax rates was important or very important. Most seem to be in agreement that the U.S. corporate tax rates are out of line with the tax rates paid by corporations in other countries, making U.S. companies less competitive.
But while we appreciate that this corporate tax rate inequality needs to be addressed, we have always expressed concern about how lowering the corporate tax rate could affect the 67 percent of IT firms that pay taxes at individual tax rates, as a sole proprietor or pass-through entity. Bringing parity in corporate tax rates should not adversely affect this large IT segment of businesses. So, we appreciate the goal of the coalition to preserve equal tax treatment for any industry or type of income.
As tax reform discussions continue here in D.C., our main goal is to protect the interests of the SMB IT. In an ever-changing political scene, the outlook for moving on tax reform legislation, or even small pieces of tax reform, remains unsettled.
