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Experts “Have Expressed Concerns” Over Clinton’s Profit-Sharing Plan

- November 13, 2015

Clinton’s Proposed Profit-Sharing Tax Credit Would Cost The U.S. Government Between “$10 Billion To $20 Billion Over A Decade.” “The tax credit would last just two years and cost the government $10 billion to $20 billion over a decade, according to the campaign, which says those costs would be offset by closing ‘loopholes’ that Clinton will specify later. She is speaking Thursday afternoon in New Hampshire about the proposal.” (Richard Rubin, “Hillary Clinton Dangles Tax Credit To Companies That Share Profits With Workers,” Bloomberg, 7/16/15)

Economists Have “Expressed Concerns” With Clinton’s Profit-Sharing Plan Saying Corporations Should Focus On Increasing Wages Rather Than Profit-Sharing. “But other economists have expressed concerns about the idea, saying it lets corporations focus on profit-sharing rather than on increasing wages or benefits. ‘There’s nothing wrong with profit-sharing, but it just shouldn’t take the place of a healthy paycheck’ said Jared Bernstein, a senior fellow at the Center on Budget and Policy Priorities and a former economic adviser in the Obama administration.” (Amy Chozick, “Hillary Clinton Proposes Tax Credit For Businesses That Share Profits,” The New York Times, 7/16/15)

Tax Experts Say That Clinton’s Proposal Won’t “Do Much To Accomplish Her Goal.” “But some tax experts say her proposal may not do much to accomplish her goal. The tax credit - which is a dollar-for-dollar reduction of a company's tax liability - would be worth 15% of the profits a company shares each year for two years. A higher credit would be available for small businesses.” (Jeanna Sahadi, “Why Clinton’s Profit-Sharing Proposal May Not Do Much,” CNN, 7/17/15)

Eric Toder, Co-Director Of The Nonpartisan Tax Policy Center, Said If Clinton’s Proposal Is “Paid For By Eliminating Other Tax Breaks” As Planned, “It Won’ t Provide Any Additional Economic Stimulus.” “Eric Toder, co-director of the nonpartisan Tax Policy Center, doesn't think the credit will do much harm. But ‘if the plan is fully paid for by eliminating other tax breaks, it won't provide any additional economic stimulus,’ he said.” (Jeanna Sahadi, “Why Clinton’s Profit-Sharing Proposal May Not Do Much,” CNN, 7/17/15)

  • Yoder Added That The “Complexity” Of The Tax Credit “Might Not Do Much To Encourage” Businesses To Participate. “What's more, Toder added, the temporary nature of the credit, and its complexity, might not do much to encourage businesses to start a new profit-sharing plan.” (Jeanna Sahadi, “Why Clinton’s Profit-Sharing Proposal May Not Do Much,” CNN, 7/17/15)

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