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Biden said to mull dropping corporate tax hike to fund jobs plan

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US President Joe Biden is searching for Republican support for his more than $2 trillion infrastructure proposal./AFP
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Jun 04, 2021 - 07:44 AM

WASHINGTON — In an effort to win Republican support for President Joe Biden’s infrastructure and jobs plan, the White House on Thursday signaled it was willing to negotiate over his pledge to increase the corporate tax rate.

The Washington Post reported Biden offered to drop his proposal to return the top corporate tax rate to 28 percent — where it had been before a Republican-backed tax cut in 2017 — from its current 21 percent level, something the opposition party strenuously opposes.

Citing sources familiar with the discussions, the newspaper said the offer was made in a private White House meeting on Wednesday with Republican Senator Shelley Moore Capito, as the president looks for opposition support for his spending plans.

White House Press Secretary Jen Psaki however said Biden has not entirely give up on the corporate tax increase which he sees as “a viable pay-for.”

But she said “those pay-fors can be moved around,” signaling there could be some flexibility in the current negotiations.

“We have a range of means for moving the president’s ideas and proposals forward,” she said, noting that Biden is scheduled to talk to Capito again Friday.

“The President remains committed to his goal of signing a bill into law… by the summer.”

The Washington Post however said Biden would instead focus on a 15 percent minimum tax that would target corporations which are profitable but pay little in taxes to the federal government.

Biden has long stressed that corporations need to “pay their fair share” and vowed not to raise taxes on Americans making less than $400,000 a year.

Both corporate tax measures were included in his budget blueprint presented last week, which showed increasing the top tax rate would bring in at least $86 billion starting in 2023, while a minimum tax would raise $10 to 15 billion a year.

The US leader, who campaigned on his ability to work with Republicans, has proposed a more than $2 trillion plan to create jobs through investments in roads and bridges while also funding green technology, expanding broadband internet access and daycare, and fixing household water supplies.

However, Republicans are pushing for a smaller and more narrowly-focused bill limited to traditional public works projects.

Psaki rejected the counteroffer to pay for some of the spending through increased fees.

“We’re not going to go down the road of user fees or other areas that would raise taxes on the American people.”

Capito’s staff did not respond to a request for comment from AFP.

Biden is also backing a 15 percent minimum corporate tax imposed globally to prevent multinationals from sheltering profits in low-tax countries.

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