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Biden willing to accept 25% corporate tax rate to fund spending programs

EconomyMay 06, 2021 09:21PM ET
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3/3 © Reuters. FILE PHOTO: A man walks in a flooded field after Hurricane Delta, in Lake Charles, Louisiana, U.S., October 10, 2020. REUTERS/Marco Bello/File Photo 2/3

By Trevor Hunnicutt

LAKE CHARLES, La. (Reuters) -U.S. President Joe Biden said a corporate tax rate between 25% and 28% could help pay for badly needed infrastructure, suggesting he could accept a lower rate than what he has proposed in his search for Republican support for the funding.

"The way I can pay for this, is making sure that the largest companies don't pay zero, and reducing the (2017 corporate) tax cut to between 25 and 28" percent, Biden said during a visit to Lake Charles, Louisiana.

In his $2.3 trillion infrastructure plan, the Democratic president initially proposed raising the corporate tax rate from 21% to 28%. Tax experts and congressional aides told Reuters in April that a 25% rate would be a likely compromise.

"What I'm proposing is badly needed" and will be paid for, said Biden, dismissing the "trickle down" theory that helping businesses and the wealthy will benefit those farther down the economic ladder. "We've got to build from the bottom up and the middle out."

Behind Biden as he spoke was the Calcasieu River Bridge, a structure built in 1952, which he said was 20 years past its expiration date. Bumper-to-bumper traffic crawled across it.

"That’s a recipe for disaster," Biden said of the crowded bridge.

Later, he stopped in New Orleans to tour the Sewerage & Water Board's Carrollton Water Plant and discuss the need for spending on water infrastructure.

The U.S. corporate tax rate dropped to 21% from 35% after the 2017 tax cut pushed by then-President Donald Trump and his fellow Republicans, but many big U.S. companies pay much less.

Increasing what companies pay https://www.reuters.com/article/us-usa-biden-tax-companies-analysis/analysis-white-house-u-s-companies-could-agree-on-25-tax-rate-officials-business-groups-say-idUSKBN2BU3EF into the more than $4 trillion federal budget is an important part of Biden’s plan to restructure the U.S. economy to reduce inequality and to try to counter China’s rise.

Biden's visit to storm-battered Louisiana, which has backed Republican presidential candidates for the past 20 years, is part of his "Getting America Back on Track Tour" to promote a $2.25 trillion infrastructure spending plan and a $1.8 billion education and childcare proposal.

His push to spend more federal money on schools, roads, job training and other public works, and to tax the wealthiest Americans and companies to pay for it, is popular with voters of both parties. But the plans face stiff opposition from Republican lawmakers.

See graphic: Biden approval tracker: https://graphics.reuters.com/USA-BIDEN/POLL/nmopagnqapa/index.html

The White House is betting trips like this will build public support for Biden and his spending proposals, even among Republican voters who backed Trump, who continues to hold enormous sway over his party.

Congressional Republicans oppose Biden’s proposed $2.25 trillion in infrastructure spending over a decade, saying the higher taxes that would be levied on corporations to fund it would cost jobs and slow the economy.

Trump has said increasing taxes on corporations could prompt some to relocate overseas in search of a better tax environment.

The U.S. economy has boomed under higher levels of corporate taxation, such as in the 1960s and the 1990s.

In the closely divided Senate, Biden would need every Democratic vote if no Republicans support the bill. Biden said in Lake Charles he was meeting with Republicans in Congress to see "how much they’re willing to go for, what they think are the priorities, and what compromises" they can offer.

"I’m ready to compromise," Biden said. "I’m not ready to have another period where America has another ‘Infrastructure Month’ and doesn’t change a damn thing."

Some Republicans have offered a far smaller package: $568 billion, focused on roads, bridges, broadband access and drinking water improvements. However, much of that reflects money the federal government is already expected to spend for that infrastructure.

U.S. Senate Minority Leader Mitch McConnell predicted last week that Biden’s infrastructure and jobs plan would not get support from Republican lawmakers.

"I’m going to fight them every step of the way, because I think this is the wrong prescription for America,” McConnell said at an event in his home state of Kentucky last month.

Biden willing to accept 25% corporate tax rate to fund spending programs
 

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Comments (9)
Roger Miller
Roger Miller May 06, 2021 11:07PM ET
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Biden is not the one willing to accept anything, he is just saying and doing as he is told.
Daniel Hodel
Daniel Hodel May 06, 2021 10:50PM ET
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If you don’t like higher taxes, move your business overseas. America can tax your shipments bigly, when it’s shipped here. We are the largest consumer in the world, if you don’t like it, Bye!
Roger Miller
Roger Miller May 06, 2021 10:50PM ET
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Eventually you need to produce to consume. Consumption does not make a society wealthy, it actually consumes the wealth that a society’s quality of life is built on. China’s infrastructure is shiny and new where as in the west it’s decaying and failing.
Darren Caris
Darren Caris May 06, 2021 10:46PM ET
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"The U.S. economy has boomed under higher levels of corporate taxation, such as in the 1960s and the 1990s." Media arm of the Democratic party totally lacks understanding of how the economy worked then. It boomed for other reasons DESPITE higher corporate tax rates
Roger Miller
Roger Miller May 06, 2021 10:46PM ET
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Exactly, the U.S. economy boomed inspite of higher levels of corporate taxation. The Democratic party as a whole lacks any knowledge of economics. Mind you many Republicans are not much better.
Me comment
Me comment May 06, 2021 10:14PM ET
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The Bible says an eye for an eye so conservative should rally around it.
Daniel Hodel
Daniel Hodel May 06, 2021 10:14PM ET
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I want to start a church, so i can be tax exempt. How do i get into that club? Are my capital gains exempt too?
Me comment
Me comment May 06, 2021 10:12PM ET
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I'd put the rate at 30% and ram it down the GOP'S throat thru reconciliation just like the GOP did with the trump tax cuts.
Darren Caris
Darren Caris May 06, 2021 10:12PM ET
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Thank God you aren't in control
Steve Lora
Steve Lora May 06, 2021 9:40PM ET
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The antifa progressives wont like this.Joey lied about $15 an hr and now this
Me comment
Me comment May 06, 2021 9:40PM ET
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dream on uneducated trump supporter as most business raise their minimums above $15 already only the conservative run GOP business are refusing to.
Kelly Mayer
Kelly Mayer May 06, 2021 9:19PM ET
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Max US corporate exodus. And tax soon to descent onto the middle class aswell.
milena villa escobar
milena villa escobar May 06, 2021 7:14PM ET
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What difference does it make. 21% of 0 is 0. 25% of 0 is still 0. They don't pay taxes anyway. All their profits are shuffled off to tax-free jurisdictions through invoice swapping
franklin neversoy
franklin neversoy May 06, 2021 5:17PM ET
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He finally broke down. Joe manchin just a little ********givin joe a hard time
 
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