Lilly chief calls on U.S. to slash taxes

Read John Lechleiter's (photo) lips: Lower Taxes. In a speech at an industry conference, the Lilly CEO called for the U.S. government to slash the corporate tax rate if it wants to see more innovation in business.

For some time, business folks have been crying foul about the corporate tax rate in the U.S., estimated at 40 percent for 2009 by KPMG. They often cite rates such as the 25 percent in China and the 28 percent in the U.K. for comparison's sake. They don't talk much about the major tax loopholes that U.S. companies use to pay far, far less than that 40 percent, of course. That would cloud the argument.

Indeed, some critics on the other side point out that U.S. companies often move profits around the globe to make sure they don't have to pay the U.S. rate. Those tax reformers not only suggest lowering the corporate rate, but also cutting out the overseas-earnings loophole--among other tax breaks--so that companies actually pay the rate set by the government.

Lechleiter says no to that idea. Lower the tax rate and keep the oversea profits break, too, he advises. And some legislation to that effect may soon be proposed in Washington, Bloomberg reports. The BIO industry association plans to unveil some innovation-boosting recommendations, including tax breaks, at its meeting next week. "Congress should be running to us asking, 'What do you need?'" BIO chief Jim Greenwood told the news service.

- read the Bloomberg story