Biden Says He’s ‘Willing To Negotiate’ 28% Corporate Tax Rate Hike
President Biden on Wednesday said he would be “willing to negotiate” the proposed hike of the corporate tax rate from 21% to 28% contained within his sweeping infrastructure plan.
Raising taxes on corporate income is one way the federal government plans to generate enough revenue pay for the Biden Administration’s ambitious infrastructure and jobs spending proposal.
That’s a change from the $1.9 trillion American Rescue Plan, which was signed into law last month and financed almost entirely with new federal debt.
A smaller hike to the corporate rate could satisfy critics like Sen. Joe Manchin, a moderate Democrat from West Virginia and crucial swing vote in the Senate who has said would favor a 25% corporate rate instead.
Republicans including Senate Minority Leader Mitch McConnell (R-Ky.) have indicated that there is no appetite within the GOP for any new tax increases.
“I’m willing to listen to that,” Biden said Wednesday in response to a question about whether he would be willing to accept a corporate tax rate lower than 28%. “But we’ve got to pay for this…there’s many other ways that we can do it, but I am willing to negotiate that.”
Biden’s infrastructure plan calls for more than $2 trillion in spending to modernize the nation’s roads and bridges, revitalize the manufacturing sector and jump-start the transition to clean energy. There’s $621 billion for transportation infrastructure like roads and bridges, $111 billion for clean drinking water and $100 billion each for expanding broadband and power infrastructure like the electric grid. That’s not to mention $213 billion for affordable and sustainable housing, $400 billion for the “care economy” and $100 billion for workforce development. All that money will be spent over a period of eight years and be paid for with tax hikes over 15 years. In addition to the corporate rate hike, Biden wants to impose a 21% minimum tax on foreign income of U.S. companies, and the White House plans to push other countries to adopt a global minimum tax. Those changes are designed to prevent multinational companies from shifting profits, production and jobs overseas.
$2.1 trillion. That’s how much Biden’s infrastructure spending proposal would raise over a decade to offset $2.7 trillion in spending, according to the Penn Wharton Budget Model.
Big business was quick to oppose Biden’s proposed rate hike after the introduction of the infrastructure plan last month. “Business Roundtable strongly opposes corporate tax increases as a pay-for for infrastructure investment,” the organization of CEOs wrote in a statement. “Policymakers should avoid creating new barriers to job creation and economic growth, particularly during the recovery.”
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Here’s What’s In Biden’s $2 Trillion Infrastructure Plan (Forbes)
Who Will Be The Biggest Losers From Biden’s Tax Hikes? (Forbes)