According to reports, Senate Democrats are considering cutting the corporate tax rate proposed in President Joe Biden’s infrastructure plan from 28% to 25% in an attempt to calm the centrists in the caucus.
Quoting sources close to negotiating the nascent infrastructure package, Axios reported on Sunday, “Democrats near the White House expect Biden to accept 25% and pocket it as a political gain.”
“What a shame. The 28% they suggested earlier was already way below the Obama presidency rate, which was 35%.”
– Ben Spielberg
But the progressives found little to celebrate when they settled for a corporate tax rate 10% lower than during the Obama administration. In 2017, then-President Donald Trump and the Republicans of Congress cut the tax rate from 35% to 21% as part of their massive and unpopular tax cut legislation.
“The highest pre-Trump corporate tax rate was 35%. The statement” companies must pay their fair share “should mean that pre-Trump rates are the starting point,” said Ohio Congressional candidate Nina Turner. “We also need to fill in the loopholes businesses use to get away with paying $ 0 in federal income taxes.”
Earlier this month, Senator Joe Manchin (DW.Va.) – the most Conservative Senate Democrat and a major swing vote – said in an appearance on a local radio show that he and “six or seven other” Democratic Senators “feel very strong” about it the conversion to a tax rate of 25% instead of 28%. Senate Democrats cannot afford to lose a single vote as they tightly control the upper chamber and give individual senators the power to shape the legislation.
Axios said, “Among those Democrats who have privately suggested they might be uncomfortable hitting 28% include Sens. Tim Kaine and Mark Warner of Virginia, Kyrsten Sinema of Arizona, and Jon Tester of Montana.”
What a shame. The 28% they proposed earlier was already well below the Obama presidency rate of 35%. https://t.co/DG0z3xoSlL
– Ben Spielberg (@BenSpielberg) April 18, 2021
For their part, some have given little specific justification for calling for a smaller corporate tax hike. In 2012, the West Virginia Democrat backed an Obama proposal to cut the corporate tax rate from 35% to 28% – a rate that Manchin now seems to think is too high.
In response to Manchin’s new stance on the 28% rate, political commentator Mehdi Hasan mocked the notion that Manchin “was very serious about the difference between a corporate tax rate of 25% and 28%, and not just tried to split the tax rate.” Difference between the position of the GOP outlier and the reasonable Biden suggestion. “
The haggling over the proposed corporate tax hike comes as Democrats are trying to figure out a way for Biden’s infrastructure package amid unified Republican opposition to the roughly $ 2.3 trillion plan. Last week, West Virginia, Manchin’s colleague Shelley Moore Capito (R) suggested that keeping the current corporate tax rate of 21% a “non-negotiable red line” for the GOP in infrastructure negotiations – a position that a top Democrat dismissed as absurd .
“Corporate revenues have fallen nearly 40% from the 21st century average since Republican taxpayers paid,” Senator Ron Wyden (D-Ore.), Chairman of the Senate Finance Committee, said in a statement. “In 2018, the United States was the last of the OECD countries to die in terms of corporate tax revenues it collected as a percentage of GDP.”
“Republicans’ insistence that the world’s most profitable businesses shouldn’t add a penny to investments in roads, schools and our clean energy future is simply unacceptable,” added Wyden.