President Barack Obama told business leaders Tuesday that the nation needs to reform its tax system to help boost the economy, saying the American people "instinctually understand" that the U.S. needs a more balanced approach to solve its economic problems.
"The economy is getting stronger and the recovery is speeding up. The question now is how do we make sure it keeps going," Obama said to the Business Roundtable, an association of chief executive officers of top U.S. corporations.
The president told more than 90 executives that the nation would "have to deal with revenue and that's something that I think the American people instinctually understand, that if we do this in a balanced way, we can solve our problems." He said the nation was not in a similar situation as debt-laden Greece, saying "we don't have to cut by 25 percent and raise taxes by 25 percent."
"These are relatively modest adjustments that can stabilize our economy, give you the kind of business confidence that you need to invest and make sure America wins for the future," Obama said, adding the business community would be an "important voice" in the debate.
Obama outlined his administration's efforts to jumpstart manufacturing, noting that the U.S. auto industry had rebounded following the economic downturn, and noted the passage of trade agreements with South Korea, Panama and Colombia, and the administration's work to bring Russia into the World Trade Organization.
Obama recently outlined a corporate tax overhaul that would lower rates but eliminate loopholes and subsidies supported by the business world. The plan is unlikely to pass in an election year but sets up a debate with Obama's Republican opponents on taxes.
Republicans noted that a former chairman of the Business Roundtable, Ivan Seidenberg of Verizon, accused Obama in 2010 of creating an "increasingly hostile environment for investment and job creation" and the organization had expressed disappointment over Obama's rejection of the Keystone XL pipeline in January.
The president's plan would lower the corporate tax rate to 28 percent, and Obama has called for Bush era tax cuts to end on individuals making more than $200,000, thus increasing their taxes, and for a 30 percent minimum tax on taxpayers who make $1 million or more. The plan has been assailed by Republicans, who contend it will curb business development.
Republican Mitt Romney, for example, has called for a 25 percent corporate tax rate, in line with what some congressional Republicans have sought. He has proposed lowering the top personal income tax rate to 28 percent from the current 35 percent.
Obama said it was important to reform taxes to reward "companies that are investing here in the United States, making sure we are able to cut our tax rates here but also broaden the base. That is going to be a difficult task. Anybody who has been in tax discussions in any legislation, but especially Congress, knows it's like pulling teeth but it's the right thing to do for us to become more competitive."
Attendees included James McNerney of Boeing, Jamie Dimon of JP Morgan Chase, Brian Moynihan of Bank of America, and Ursula M. Burns of Xerox Corp. The organization is led by former Michigan Gov. John Engler, a Republican.