Is There a Hint of Tax Relief in the Air for Corporate America?

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While there will certainly be plenty of disagreement on details, it appears there may be some level of consensus in this Congress on the need for tax reform, including corporate tax reform. Senate Majority Leader Harry Reid (D-NV) has said "the country is ripe for tax reform" and that "our tax system is broken and needs to be fixed." Senate Finance Committee Chair Max Baucus (D-MT) will continue holding hearings on reform this year.

While we have heard cries for reform for a long time, the continued economic difficulties are putting the recent elections and the upcoming 2012 elections into perspective. Some Democrats seem to be accepting the fact that support from business groups may be needed in the 2012 elections. A tweak in the way corporations are taxed, whether permanent or temporary, may be the olive branch needed to drum up corporate support. President Obama’s selection of Bill Daley as his new chief of staff indicates a move towards addressing the concerns of the business community.

It will be interesting to see how Obama addresses the issue of tax reform in his State of the Union at the end of the month. Statements and developments of the last few days seem to indicate we may see something more than “lip service” to tax reform this year.

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