Over in the Wall Street Journal, Stephen Entin makes a great case for incorporating corporate tax cuts in the stimulus package:
We need a permanent improvement in the production climate. What would help? A lower corporate tax rate, as well as a permanent extension of the 2008 expensing provisions and the 2003 dividend and capital gains and top marginal income tax rates. On the regulatory side, lifting the burdensome auto fuel economy standards and alternative fuel requirements would help, as would an elimination of restrictions on oil drilling.
Taxes and regulations raise the bar for investment to be profitable after-tax, and they fall especially hard on capital-intensive industries such as manufacturing and resource extraction. We have the second-highest corporate tax rate in the developed world (after Japan). A lower rate would make us a more attractive location for business. Similarly, the excess of the U.S. corporate tax rate over the foreign rate is imposed on repatriated earnings — keeping foreign-source earnings abroad exactly when domestic credit is hard to get. To spur investment in 2004, Congress declared a partial tax holiday on repatriated earnings. Now would seem an opportune time to do so again.