On Monday, Democratic Sen. Joe Manchin (W.Va.) said he doesn’t support the tax increases on corporations proposed by President Joe Biden as part of a spending proposal worth almost $2.3 trillion. This would potentially shoot down an important revenue raiser that’s part of the infrastructure initiative.
The president’s plan would increase the corporate tax rate to 28% from 21%. It would also raise the global minimum tax on companies in the U.S. to 21% from around 13%. According to the White House, the tax increases would fund the proposed infrastructure investments over the course of 15 years.
Manchin: Proposed Rate Could Hurt Competitiveness
However, Manchin said that the proposed rate is too high. He added that it could hurt competitiveness among American companies. Instead of the proposed rate, he suggests boosting it to 25% instead while closing tax loopholes used by many wealthy people in dodging taxes.
Meanwhile, members of the GOP have widely rejected this sweeping economic package. This means Democrats would likely need to pass the proposal through budget reconciliation. It’s the same Senate rule that they used to approve the American Rescue Plan even without a Republican vote.
Although, Manchin said that if he doesn’t vote on it, it will not push through. He added that apart from him, there are “six or seven other Democrats” who feel the same way about the proposal.
The White House mentioned that it is open to feedback from lawmakers regarding how to best address infrastructure projects. Many see this as a bipartisan issue in Washington.
As per White House Press Secretary Jen Psaki on Monday, Biden felt that it’s proper to propose a means to pay for the projects. So, “that’s exactly what he did” even though he knows some members find the rate too high. Psaki added that that the question on how they will fund the proposal is an expected part of the discussion and that they are welcome to new ideas.