Commerce Sec says there is a “room for compromise” on Biden’s corporate tax hike proposal
Apr 08, 2021 - 05:59 AM
LMBC NEWS — The Joe Biden administration is giving a “room for compromise” on the increase from 21 percent to 28 percent corporate tax to fund his massive $2.3 trillion infrastructure plan.
Secretary of Commerce Gina Raimondo, joining Press Secretary Jen Psaki in a press briefing Tuesday, answered one of the concerns that the increase to 28 percent corporate tax would make the United States among countries asking for the highest corporate tax in the world.
“There is room for compromise; that is clear,” she said, noting that President Biden directed to have the plan done by involving both sides of the aisle and “in a bipartisan way.”
“Like, our proposal is to invest in 8 years and pay it back over 15,” she said. “Now, we can have a discussion about that. Should we pay it back over 20 instead of 15? Is the rate not quite 28? Is it something, you know, lower? So we’re — we want to compromise.”
The infrastructure plan of the President has been slammed by Republican lawmakers in the Congress for being too expensive, with coverage not only limited to traditional repair and construction of roads and bridges but also include manufacturing investment, child-care services, and a hike on essential home-care employees.
Some Republicans also referred to the Tax Foundation, which says that the hike on corporate tax shed 159, 000 jobs over one to three decades, arguing that increasing the corporate tax could affect jobs in the long run.
But Raimondo said she does not agree with the assessment.
The secretary said that big and small business owners she talks to agreed in pushing through the investment infrastructures proposed by the President to make the U.S. competent.
“If we don’t invest in semiconductors, we’re going to fall further behind. If we don’t invest in job training, we’re not going to have the workforce that businesses need to compete. So it’s essential that we make these investments,” she said.
During the Donald Trump administration in 2017, the corporate income tax rate was cut from 35 percent.
“With respect to taxes, there is not a shred of evidence to show that the cuts in 2017 increased growth or productivity. Actually, very little of it went into additional R&D,” she noted, adding that the present corporate structure is “broken” with several huge profitable companies evading paying corporate taxes.
“So I’d like to think we can all agree that it needs to be improved, level the playing field, close the loopholes, and have a discussion around how we do this together to improve competitiveness,” she said.