GLENN HUBBARD, GRADUATE SCHOOL OF BUSINESS, COLUMBIA UNIV.: The tax foundation tells us that tax freedom day, the day on which we stop working just to pay our taxes, is April 30 this year. But get ready for a longer tax winter. The expiration in 2010 of the 2001 and 2003 tax cuts would raise tax rates on work, saving and entrepreneurship. And the Federal tax share of GDP, which has averaged about 18 percent over the past 40 years, will climb to over 20 percent in a decade and continue to rise.

There are two important ways to avoid the impending tax increase and that offer significant economic benefits. First, the 2001 and 2003 tax cuts should be made permanent. Second, spending restraint would permit additional tax cuts that promote objectives of economic growth and simplification. Two candidates are reductions in the corporate tax rate and in personal income taxes. The United States now has the highest corporate tax rate in the OECD and the corporate tax burdens not only profits, but investment and wages. And additional cuts in marginal tax rates would enhance economic efficiency and growth. The annual ritual of preparing one’s taxes focuses the mind. Given that the presidential contest has started so early, let’s hope the candidates take the time to tell us about their plans for the tax cuts of 2001 and 2003, as well as their own. I’m Glenn Hubbard.

from thisHow is it that the US is so successful, yet also suffers the highest corporate tax rate?