Raising the corporate tax rate would be among the first policies enacted under a Joe Biden presidency, according to the Democratic candidate, even if the economy is still recovering from the coronavirus pandemic.
“I’d make the changes on the corporate taxes on day 1,” and not wait for employment to rebound, Biden told CNN’s Jake Tapper September 10. “It could raise $1.3 trillion if they’d just start paying at 28 percent instead of 21 percent.”
Biden argued that corporations aren’t using the lower tax rate established by the Tax Cuts and Jobs Act to hire more people, but instead to buy back their own stock and get “wealthier and wealthier and wealthier.”
But with congressional authorization required for the tax changes, raising the corporate rate “would be quite difficult to do on the first day,” said Victoria Glover of Deloitte Tax LLP during a September 11 webcast.
Biden’s latest pledge comes in contrast to comments made in August by one of his campaign advisers, Jared Bernstein, who said that a decision to raise taxes would be “very dependent on economic conditions.”
Overall, Biden has proposed an estimated $4 trillion in tax increases on corporations and wealthy Americans. In addition to raising the corporate tax rate, he wants to establish a 15 percent corporate minimum tax on global book income of $100 million or more.
The former vice president also recently proposed an additional 10 percent surtax on American corporations that offshore production but sell goods back to the United States. Combined with the proposal to increase the corporate tax rate to 28 percent, corporations would end up paying 30.8 percent on applicable profits, Biden’s campaign says.
Biden said he would use the revenue raised by higher corporate taxes to invest in domestic manufacturing, education, and healthcare. “These are things that matter to middle-class families,” he said.