Biden pitches GOP on 15% minimum corporate tax rate in infrastructure package

President Joe Biden suggested a 15% minimum tax on corporations coupled with increased IRS enforcement during negotiations as an alternative to raising the corporate tax rate in talks with Republicans regarding an infrastructure package. 

Biden raised the prospect during his Wednesday meeting with Republican Sen. Shelley Moore Capito of West Virginia. He offered a number of ways that a robust infrastructure package could be funded that would still leave the 2017 tax cuts intact, a person familiar with the situation told the Washington Examiner. 

Republicans have repeatedly said that Biden’s plan to raise the headline corporate tax rate from 21% to 28%, partially reversing the rate cut included in the 2017 Trump tax overhaul, in order to pay for an infrastructure package would not garner the support of GOP lawmakers. 

While the Wednesday proposal for a 15% minimum tax on corporations coupled with increased IRS enforcement set aside the corporate rate hike as part of these specific infrastructure negotiations, the administration is still seeking all of the tax reform proposals it has floated, including raising the rate to 28%, according to the person.

During a press conference on Thursday, White House press secretary Jen Psaki confirmed that Biden has not abandoned his overall plan to hike the corporate tax rate. 

“He believes we should look to continue raising the corporate rate,” she told reporters. “He continues to believe that corporations can pay more.”

A 15% minimum tax was already part of Biden’s originally proposed American Jobs Plan, but it was highlighted during the meeting with Capito because it doesn’t cross the GOP red line about increasing the headline corporate tax rate. 

The minimum would attempt to make it so that some corporations that pay nothing in federal taxes through legal maneuvers are forced to pay at least 15%. The proposal also seeks to increase revenue by conducting more IRS audits on the wealthy. The White House claims an $80 billion investment in the IRS could raise some $700 billion over a decade. 

While both parties agree that a comprehensive infrastructure plan is needed, the two sides began negotiations far apart on scope and funding. The White House initially proposed a $2.3 trillion package that included funding for a wider array of items, some that the GOP said fell outside the scope of real infrastructure.

Republicans' first counteroffer fell far below the $2.3 trillion, clocking in at just $568 billion. The administration then put forward a $1.7 trillion compromise, followed by Republicans suggesting $928 billion. Biden’s suggestion during his meeting with Capito on Wednesday reportedly called for $1 trillion in new spending.
Avoid Scams by Richard Patterson is licensed under Attribution 2.0 Generic (CC BY 2.0)

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