Here is Mitt Romney’s plan to reform corporate taxes:

The U.S. economy’s 35 percent corporate tax rate is among the highest in the industrial world, reducing the ability of our nation’s businesses to compete in the global economy and to invest and create jobs at home. By limiting investment and growth, the high rate of corporate tax also hurts U.S. wages.

Cut the corporate rate to 25 percent

Strengthen and make permanent the R&D tax credit

Switch to a territorial tax system

Repeal the corporate Alternative Minimum Tax (AMT)

Now here is the corporate tax reform plan put forward by President Obama’s Council on Jobs and Competitiveness from earlier this year.

 As of April 1, when Japan reduces its rate, the U.S. will have the highest st …  At the same time, our worldwide system of corporate taxation discourages companies from investing their foreign earnings in the U.S. The result is an outdated and extremely inefficient system that creates economic distortions and puts U.S. businesses and workers at a disadvantage.

The Council recommends moving from a corporate tax system with a high rate and a narrow tax base to one with a broader base and a lower tax rate. This would not only enhance economic efficiency but encourage more investment in the U.S. by foreign and domestic companies, boosting economic growth as well as employment. …

Many Council members agree that the U.S. should shift to a territorial system of taxation in order to make America more competitive in global markets. While most other developed nations have adopted territorial systems that exempt most or all foreign income from taxes when they are repatriated, the U.S. subjects all worldwide earnings to the corporate income tax when they are brought home to the U.S. This approach actually encourages U.S. companies to keep their earnings abroad rather than investing them here at home. Adopting a territorial tax system would bring us in line with our trading partners and would eliminate the so-called “lock-out” effect in the current worldwide system of taxation that discourages repatriation and investment of the foreign earnings of American companies in the U.S.

Obama doesn’t like the Romney tax plan and, thus, that of his own jobs council. This is the Simpson-Bowles debacle all over again.

Obama particularly doesn’t like the bit about switching to a territorial tax system. His campaign has been citing research that argues such a move would increase employment in low-tax countries by 800,000 workers, a claim that Obama implies would mean American would lose 800,000 jobs.

A few thoughts:

1. Right now, the U.S. government taxes the income that U.S. corporations earn overseas. That income is first taxed at the corporate tax rate of the country in which it is earned. Then, if those earnings are brought back to the U.S., companies must then pay the difference between the lower foreign tax rate and the higher U.S. rate.

2. Governments of most advanced economies do it differently, taxing only those earnings made within its borders. This obviously puts U.S. companies at a competitive disadvantage.

3. As the Tax Foundation notes, that measure of 800,000 jobs is simply foreign employment growth. It does not mean job “displacement” or “migration” out of the U.S. … To the contrary, empirical research indicates that foreign employment growth increases demand for exports and increases productivity of U.S. workers.

4. If the U.S. moved to a territorial system while also lowering rates to at least the OECD average, companies would begin to bring back some of the $1.5 trillion in earnings currently harbored overseas. That could create as many as 3 million jobs over two years.

Again, opposition to the Romney-Obama Jobs Council plan is a pure example of political expediency defeating sound policy.