President Joe Biden on Monday defended his proposal to raise the U.S. corporate tax rate, calling it false that doing so would drive businesses away from the country.
Biden has proposed tax increases on corporations as part of a $2.3 trillion infrastructure plan. He would raise the corporate rate to 28% from 21% as well as increase taxes on companies’ foreign earnings.
Returning to Washington from Camp David on Monday, Biden fielded a reporter’s question about worries a higher tax would drive corporations away from the U.S.
“Not at all,” Biden said. “There’s no evidence of that.”
Former President Donald Trump and congressional Republicans cut the corporate rate to 21% from 35%. Republicans have panned Biden’s tax proposals, and on Monday, West Virginia Sen. Joe Manchin, a key Democrat, said he wouldn’t support a boost in the corporate rate to 28%.
Manchin told a local news station he could support an increase in the corporate rate to 25% and that he’d be in favor of closing tax “loopholes” that benefit the wealthy.
White House press secretary Jen Psaki said that the administration expects different ideas such as Manchin’s on how to pay for the infrastructure package.
“We’re open to hearing ideas and proposals from members and we encourage them to put them forward,” she told reporters at a briefing.
As MarketWatch reports, international tax changes for multinational corporations are a key part of the Biden administration’s plans to pay for the infrastructure package. Monday, Treasury Secretary Janet Yellen said she’s working with nations around the world to end the “race to the bottom” in corporate tax rates.
Senate Democrats are also offering proposals to increase the tax burden on U.S. companies’ foreign profits, the Wall Street Journal reports. A new framework from Sens. Ron Wyden of Oregon — who leads the finance committee — Sherrod Brown of Ohio and Mark Warner of Virginia is designed to prompt other Democrats to offer their ideas, the Journal said.
swept to fresh highs on Monday on another round of good economic news from the services sector, adding to the array of indicators showing improving activity, including a stellar March jobs report from last Friday.