Earlier this week I told you about  the growing list of banks that are choosing to opt out of the TARP program and give the money back. Today, TCF Chief Executive Bill Cooper appeared on Fox News to explain his reasons for doing so.

I've got a great article that I came across over the weekend. CNBC did a thorough analysis of where the wealthy folks live whom President Obama is targeting for tax hikes as prescribed by his budget for fiscal year 2010. The President's budget raises tax rates on those couples making over $250,000 a year and individuals making $200,000 a year. The article reports that it will impact about 3% of all U.S. Households.

Among those states that will be most affected by the President's tax hikes is Minnesota:

15. Minnesota

% of Households Earning $200K : 3.8%
Total Households: 2,062,681
Households Earning $200K : 77,772
Median Income: $57,932

Election Results:
Obama: 54%
McCain: 44%

This might come as a surprise to you, but the United States is near the top of the list of industrialized countries with the highest corporate tax rates.

You may be asking yourself "so what," or "who cares," but it's important to recognize that lower corporate tax rates result in attracting more investment capital. A reduction of the federal corporate tax rate would increase firms' productivity and investment incentives, and ultimately stimulate our nation's long-term competitiveness by enhancing economic freedom.  The end result would be a boon to your family budget.

The trend for countries around the world is to slash corporate tax rates to spur economic growth, yet Washington has yet to come to grips with this financial reality. 

Currently, America's combined corporate tax rate sits at 40%, and it has been there since 1994. Last year alone, 23 counties slashed their corporate rates, including Canada, China, Columbia, the Czech Republic, Denmark, Germany, Hong Kong, Israel, Italy, Malaysia, New Zealand, Singapore, South Africa, Spain, Switzerland, and the United Kingdom.

According to a new study release by the accounting firm KPMG:
 
“U.S. corporate income tax rate is higher than all other global regions—14 percentage points higher than the global average and nearly 17 percentage points higher than the average among European Union nations. Of the 106 countries surveyed, only the United Arab Emirates, Kuwait, and Japan impose a higher corporate tax rate than the combined rate of 40 percent. The United Arab Emirates and Kuwait each have a staggering tax rate of 55 percent; Japan’s rate is 40.69 percent.”

The Heritage foundation reports that:

"Even Europe's old welfare states have joined the aggressive tax cut parade: Sweden has cut its corporate tax rate to 28 percent from 60 percent; Norway's rate has dropped over 50 percent to 28 percent; and Denmark's corporate tax rate is now 25 percent."

In fact, Sweden is considering reducing it further to 26.3 % from the 28% it is at now.

If our competitors around the world are making their country a friendlier place to do business while America’s corporate rates remain high, it doesn't take an economist to realize that our global competitiveness will be left in the dust.

For more information about the study, check out the non-partisan Tax Foundation's most recent newsletter (Pg. 5).

If we want to create jobs and stimulate the economy, one of the best ways we can do that is by cutting the corporate tax rate, not by spending hundreds of billions to stimulate government and creating more and more debt for our children.

Democrat leadership in Congress and President-Elect Barack Obama have made it perfectly clear that they are dead set on renewing the Death Tax rather than letting it expire in 2010.

An editorial in today's Wall Street Journal does a nice job detailing the ins-and-outs of the death tax and it's impact on the struggling middle-class businesses that Obama and the Democrats say they want to protect.

Democrats want to make the current death tax rate of 45% permanent, and while the Democrats like to portray the tax as targeted to those super-wealthy folks like Bill Gates and Warren Buffett, that is simply not the case. According the WSJ piece:

"The death tax strikes most heavily at small- and medium-sized family-owned businesses that generate the majority of new American jobs. So hitting these family businesses with a multimillion dollar tax bill when the owner dies won't help job creation."

I am an original cosponsor of H.R. 205, the Death Tax Repeal Act, just reintroduced in the House. Don't let the them fool you with their messaging -- this tax isn't about the wealthy. It impacts family farms and businesses -- the lifeline of Main Street that is vital to a healthy economy. With the economy in such a fragile state, renewing this tax will continue to hamper the economic prospects of our nation. Let's let the death tax die, once and for all.

The non-partisan Tax Foundation released their 2009 State Business Tax Climate Index earlier this week, and Minnesota was in the spotlight. Minnesota made the list of the ten WORST states for businesses, coming in at 41 - not exactly the place we want to be in today's already sluggish economy.

The foundation notes, "The modern market is characterized by mobile capital and labor. Therefore, companies will locate where they have the greatest competitive advantage. States with the best tax systems will be the most competitive in attracting new businesses and most effective at generating economic and employment growth."

The Index has been published yearly since 2003. It ranks states based on the taxes that matter most to businesses and business investment: corporate tax, individual income tax, sales tax, unemployment tax and property tax.  The states are scored on these taxes, and the scores are weighted based on the relative importance or impact of the tax to a business.

For more background on their findings, click here.

To read the full report, click here.

Today, the House passed H.R. 6275, the Alternative Minimum Tax Relief Act, sponsored by Rep. Charles Rangel (D-NY). This atrocious bill would impose $61.6 billion in permanent tax increases on businesses and individuals over eleven years in order to temporarily prevent for just one year a huge, unintended tax increase.  This bill would place a one-year “patch” on the exemption level for the Alternative Minimum Tax (AMT), without which more than 25 million taxpayers would be subject to a large tax increase beginning in tax-year 2008. 

Congressman Charles Rangel (the bill’s architect) and I had a nice little debate about it on CNBC’s Squawk Box this morning.



What makes this bill worse is that it would single out oil and gas companies from a broad domestic manufacturing tax deduction available to nearly all manufacturing in the United States. This is an irresponsible measure. Not only would it create disincentives for domestic energy production and investment, but it would make foreign energy investment and reliance more attractive. At a time when gas prices are soaring , increasing taxes on energy companies will make it even less likely that energy prices can come down.

We should completely repeal this antiquated tax policy without tax increases and give American taxpayers the full relief they deserve. This bill is a permanent tax increase to give a one-year tax cut. That’s a really a bad deal for the American people.

For more info on this legislation, check out my article published today by National Review Online: Be Pro-Choice: The AMT really has a hold on the middle class.