During his Fiscal Responsibility Summit on Monday, President Barack Obama discussed the possibility of lowering the statutory corporate tax rate while also closing tax loopholes that allow companies to reduce taxes.

In an exchange with Rep. Charles Rangel, D-N.Y., chairman of the tax-writing House Ways and Means Committee, Obama and Rangel talked about the tradeoffs that would need to be made if that happened.

“If you're looking for a fight, a partisan fight, every loophole you close is a tax increase, and we have to get over that to make certain that the vast majority of businesses recognize it’s in their best interests to do the right thing,” said Rangel.

Obama responded by pointing to the Tax Reform Act of 1986. “You were here in ’86,” he told Rangel. “It's been done before. We might be able to get it done this time.”

Among the loopholes that Obama may close are those that allow companies to take advantage of transfer pricing to shift revenue to foreign subsidiaries. However, companies have lobbied heavily to keep those tax provisions in place and made contributions to members of Congress in hopes of preserving them.

In his opening remarks at the summit, Obama said, “We’ll end the tax breaks for companies shipping jobs overseas, and we’ll stop the fraud and abuse in our Medicare program.” He also said he plans to reinstate the pay-as-you-go rules of the 1990s, which require Congress to make revenue-raising offsets for any tax breaks.

Obama made a similar statement about ending tax breaks for companies shipping jobs overseas during his address to a joint session of Congress on Tuesday evening. He also reiterated his plan to raise taxes on those making more than $250,000 per year.

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