Biden willing to put aside the increase in corporate tax to favor a minimum tax of 15%.
US President Joe Biden offered to scrap his idea of raising corporate tax to 28% during negotiations with Republicans, which would be a major concession from the Democrat seeking a bipartisan infrastructure investment deal.
According to sources cited by Reuters and the Washington Post, in his meeting this Wednesday with the Republican’s main negotiator, Senator Shelley Moore Capito, the White House tenant raised the possibility of withdrawing the proposal to increase the tax burden on companies. homelands from the current 21% to 28%.
In return, the president advocated establishing a minimum tax rate of 15% that would force dozens of US companies that pay little or nothing to the federal government to comply with the treasury.
His Administration also proposes to intensify the application of the law to companies and higher incomes that resort to legal loopholes to reduce their tax burden. According to government estimates, simple strict compliance with tax laws would raise $ 700 billion over the next decade.
Mind you, Republicans would have to accept at least $ 1 trillion in new additional spending for infrastructure. Biden’s emphasis on these concessions demonstrates his commitment to trying to achieve a bipartisan agreement, as even within his own party moderate senators, such as Joe Manchin, have opposed raising the corporate tax to 28%. In the particular case of Manchin, the West Virginia senator, has defended a more moderate rise, up to 25%.
In this way, Biden would meet his goal of preserving the promise not to raise taxes on Americans who earn less than $ 400,000 a year, while moving away from the “red line” established by Republicans, who consider the cuts 2017 tax bill as his greatest economic achievement.
Still, even with the new tax concession, the White House’s proposed plan, which seeks at least $ 1 trillion in infrastructure, is still four times what Republicans are willing to spend.
By arriving at the meeting, Republican leaders had endorsed some $ 257 billion in additional spending for infrastructure, while maintaining their unwavering opposition to any tax hike to fund it.
