Still More on the Costs of the Corporate Tax Cut

I spoke to a senior Department of Finance official who tells me that the $6.1 Billion annual revenue loss number for 2012-13 when the rate moves to 15% is calculated relative to the already announced reduction in the rate to 18.5% in 2011-12, NOT relative to the current rate of 22%.

To my mind this means that the “real” annual revenue loss of going from where we are right now to a 15% rate is indeed in the range of $12 Billion, not $6 Billion.

Calculated in this way, the allocation of tax cuts between corporations and people is dramatically different than that presented in the Statement.