FORTUNE -- The deficit reduction plan that President Obama's bipartisan commission will vote on tomorrow is drawing sharp fire from ideological groups on both the left and the right. To bring federal spending in line with revenues, the proposal released by co-chairmen Alan Simpson and Erskine Bowles inflames liberals by slashing spending on social programs and conservatives by raising taxes.
But corporate interests with billions on the line in the plan's sweeping overhaul of the tax code have been more circumspect. That's because beyond a handful of sectors targeted by the changes, it's not immediately clear precisely who wins and who loses under the proposed revamp of the system.
The plan raises tax collections by about $1 trillion to help hit its mark of reducing the deficit by roughly $4 trillion over the next ten years. It manages to do that while lowering both individual and corporate rates by scraping away scores of tax breaks that have attached to the code over the years like special-interest barnacles. Among the individual deductions the plan calls for eliminating, for example, is the mortgage-interest write-off, a proposal that is eliciting howls from the housing industry.
On the corporate side of the ledger, most large outfits face a 35% tax rate today but can pay a significantly lower effective rate when their deductions are factored in. The proposal would lower the corporate rate to 28%. But even tax experts close to the process are unsure who would benefit on balance from the so-called "base broadening" -- and who would end up paying more to finance the lower rates.
In general, capital-intensive industries like manufacturers, miners and oil and gas companies appear to be in line for some of the roughest treatment, since the proposal would eliminate a slew of deductions in the current code that encourage domestic production, including accelerated depreciation and the last-in-first-out accounting method for inventories. "We really need more details, but my first reaction is that manufacturers could end up on the short end of the stick," said Dorothy Coleman, vice president of tax and domestic policy for the National Association of Manufacturers.
Weighing all possibilities
Those industries are eyeing an Ernst & Young analysis of a similar proposal advanced in 2007 by Rep. Charlie Rangel (D-N.Y.), then-chairman of the House Ways and Means Committee. While there are important differences between the plans -- particularly with regard to multinational corporations -- both lower the corporate rate by hacking away at deductions.
The accounting firm's breakdown found that the Rangel proposal would hike the mining sector's tax liability by 12% and petroleum and coal producers' by 16% while reducing rates for most other industries. The biggest winners: "domestic only services corporations that benefit from the lower corporate tax rate without being significantly affected by repeal of the production deduction or inventory methods."
The deficit commission proposal also calls for boosting the competitiveness of U.S.-based multinationals by moving from a system that taxes income earned abroad when it's repatriated to one that would exempt "most or all of the foreign profits." But tax experts say crucial details about how the plan would work remain unclear -- for example, the treatment of expenses associated with that foreign source income.
Another important caveat for businesses trying to examine the impact of the proposal: its projections are based on the work of the Tax Policy Center, a cooperative effort between the Urban Institute and the Brookings Institution. One tax expert warned that while the center is "smart and honest," it lacks the modeling capabilities available to the government's official bean-counters.
That means if the plan is translated into legislative language, the official projection could find the commissioners' conclusions missed the mark and that the corporate tax rate cannot be lowered as far as they hoped -- an outcome that could scramble the bottom-line calculus for many.
To be sure, prospects for the overall effort remain tenuous at best. Fourteen of the 18 commissioners must endorse the plan tomorrow for the panel to issue a formal recommendation, and that level of support looks unlikely. But corporate interests are paying attention, recognizing pieces of the plan could end up resurfacing in next year's budget debate and beyond.
It's a fact the commissioners themselves are reveling in. Alan Simpson, the former Republican senator from Wyoming co-chairing the effort, acknowledged that the oil, gas and coal industries in his home state could wind up taking it on the chin -- and that he could face a rough homecoming as a result.
"I may have to divert my flight," he said Wednesday at the end of the commission's last public hearing. Simpson predicted encounters with former constituents asking, "What the hell were you doing?"