Obviously you gain revenue from going from 99% to 98% tax rates, but our rates are nowhere near where you'd gain revenue by lower tax rates.
I really don't think a 45% top corporate tax rate is a good idea.
Goldman Sachs and other multibillion dollar companies could afford it.
The question is whether they want to afford it. A 45% corporate rate in the US puts the US at an enormous disadvantage compared to other developed countries. The UK will cut it to 17%, France will cut it to 25%, the Netherlands will cut it to 21%, even Germany's 30% rate suddenly looks very attractive. Sure, the corporate tax isn't the only thing corporations take into account while relocating (infrastructure and an educated workforce also are very important, they're probably even more important) but a 45% rate would be extremely far outside the mainstream. It also raises the cost of capital and it would increase excessive borrowing (interest on corporate debt is deductible, while there is no such deduction for equity. Corporations with excessive debt would see a much lower tax increase than more "healthy" corporations). I think I've read somewhere that a 10% hike in the corporate income tax rate would lead to a quite significant increase in debt-financing because the gap between debt-financing and equity-financing would widen. Corporations would still pay a 0% effective rate on debt-financed investment because of the deduction (no matter the normal rate) while they'd pay the new 45% effective rate on equity-financed investment (instead of the old 35% rate).
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