The universe of Democratic senators concerned about raising the corporate tax rate to 28% is broader than Sen. Joe Manchin, and the rate will likely land at 25%, parties close to the discussion tell Axios.
Why it matters: While increasing the rate from 21% to 25% would raise about $600 billion over 15 years, it would leave President Biden well short of paying for his proposed $2.25 trillion, eight-year infrastructure package.
- Biden’s plan to increase the rate U.S. multinationals pay on their foreign earnings from 10.5% to 21% is less controversial and stands a better chance of remaining intact in the final legislation. That would raise an additional $700 billion.
- But corporate lobbying groups are preparing for a long-term battle over both rates.
- The Business Roundtable launched an advertising campaign last week and released a survey of 178 CEOs discussing how the proposed changes would affect their company’s competitiveness.
The big picture: The White House hasn’t publicly backed away from the president’s proposed 28% rate but indicated it’s willing to find a compromise to pay for his spending plans.
- Democrats close to the White House expect Biden will accept 25% and pocket it as a political win.
- President Trump lowered the rate from 35% to 21%.