Obama still wants corporation taxation reform

President Barack Obama remains committed to reforming international corporate taxation to end unfair loopholes, although congressional tax writers and others doubt that will happen without broader reforms such as cutting the top corporate tax rate.

Obama ignited fear in corporate America earlier this year when he proposed about $200 billion in tax increases over a decade by tightening corporate tax rules for multinational companies, mostly related to offshore profits.

A White House spokeswoman on Tuesday said the president is committed to those proposals, commenting on a front-page article in The Wall Street Journal that said the Obama administration has shelved the plan.

U.S. lawmakers and tax experts say the plan to crack down on corporate taxes never had a chance on its own given opposition from chairmen of several key congressional committees.

Marc Gerson, a former House Ways and Means Committee staffer, said lawmakers, assisted by the efforts of the business community, recognized these as fundamental changes.

To the extent that they are considered at all, it will considered as part of a larger consideration of reforming the international tax rules, said Gerson, who now councils corporate clients at Miller & Chevalier in Washington.

Obama's crowded legislative agenda -- which includes reforming U.S. healthcare, stricter financial services regulation and capping greenhouse gas emissions -- means any tax proposals are unlikely to move forward until 2010.

The House Ways and Means Committee is working on a broader plan to overhaul the tax code, which would including many of Obama's ideas and cut the top corporate rate.

The U.S. has among the highest corporate tax rates in the world at 35 percent. Ways and Means Committee Chairman Charles Rangel, a Democrat, is looking at lowering the rate to 28 percent, or even lower.

He is willing to go even lower if others come forward with loopholes to close, Rangel spokesman Matt Beck said.

(Additional reporting by Steve Holland; Editing by Ross Colvin and Tim Dobbyn)