Does a Delay in Corporate Rate Cut Make for More Growth?

Cutting the corporate tax rate but delaying the cut for a year, as the Senate tax bill would do, might boost economic growth in 2018—when combined with the ability to immediately write off capital investment—a tax think tank says.

The Senate bill, like the House-passed measure ( H.R. 1), would reduce the corporate rate to 20 percent from the existing 35 percent, but unlike the House bill would delay the cut until 2019—while allowing for the immediate deduction of capital investments in 2018. The deduction, known as full expensing, would be allowed for five years.

A company “would ...