REFILE-UPDATE 1-Geithner gauging support for big US tax change

(Refiles to fix typo in 5th pargraph)

* Geithner meets CFOs Friday to talk corporate tax

* U.S. corporate rate among highest in world
(Adds byline, details of upcoming Geithner meeting with CFOs)

By Kim Dixon

WASHINGTON, Jan 12 (BestGrowthStock) – The Obama administration is
exploring ways to boost tax incentives for corporate investment
in the United States, Treasury Secretary Timothy Geithner said
on Wednesday, ahead of his meeting with chief financial
officers from some of America’s biggest companies.

“We’re examining whether we can find political support for
a comprehensive tax reform — revenue neutral — but that would
improve incentives for investing in the United States,”
Geithner said in comments after a speech at Johns Hopkins
University’s School of Advanced International Studies.

Geithner is expected to meet with CFOs of major U.S.
companies including Microsoft Corp (MSFT.O: ) and Cisco Systems
(CSCO.O: ) on Friday to hash out ideas for simplifying and
trimming the corporate tax — nearly the highest in the
industrialized world.

Corporate tax reform is the starting place for a
conversation about broader tax reform, administration officials
have said. However, a divided Congress will make it difficult
to pass any meaningful reform over the next two years.

Several White House officials have said they agree with
companies’ main gripe that the federal corporate tax rate —
topping out at 35 percent — is too steep. Both sides also say
the tax code is way too voluminous and cumbersome.

At the same time, administration officials and others note
that deductions and loopholes make it rare for companies to pay
a 35 percent rate.

Geithner made the distinction between “effective” tax rates
— what companies actually pay — and “statutory” tax rates —
what the law says they should pay.

“Although our effective tax rates for corporates are
roughly even, our rates are roughly the average of the other
major economies, our statutory rates are much higher,” Geithner
said.

He acknowledged that the high rates on the books may
influence corporate decisions about where to invest.

“There are limits we can do in terms of how we can go about
reform without taking …. that into consideration,” he said.

Dorothy Coleman, vice president of tax and economic policy
at the National Association of Manufacturers, said cutting the
corporate tax rate is a “huge issue” for the group’s members,
several of who will attend the Friday meeting.

“We’re viewing this as a beginning of a debate and a sign
that the administration is serious,” Coleman said.
(Additional reporting by David Lawder)

(Reporting by Kim Dixon and David Lawder; Editing by James
Dalgleish and W Simon )
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