As Congress returns from recess this week with President Biden’s ambitious infrastructure plan at the top of Democrats’ agenda, a new Business Roundtable survey found that 98% of the CEOs polled believe the 28% corporate tax rate included in the plan will hurt their company’s competitiveness.
Of the 178 CEOs polled, 75% said increased taxes will negatively impact their company’s investments in research and development.
Another 71% said the tax hikes would negatively impact their ability to hire.
“As we look toward recovering from the COVID-19 pandemic, keeping competitive tax policies in place is needed to help reinvigorate the U.S. economy and lead to more opportunity for Americans,” Raytheon Technologies Corporation CEO Gregory J. Hayes said in a Business Roundtable release.
“Here you have 51 or 52 corporations of the Fortune 500 haven’t paid a single penny in taxes for three years,” President Biden said last week. “Come on, man. Let’s get real.”
55. That’s how many major U.S. companies—all part of either the Fortune 500 or the S&P 500 index—that paid no corporate income tax in 2020 thanks to credits and deductions, according to an analysis by the Institute on Taxation and Economic Policy.
President Biden campaigned on a platform of tax increases for big corporations and the wealthy—including a bump in the corporate rate from 21% to 28%. That tax hike and others will help pay for Biden’s $2 trillion infrastructure plan, which is designed to modernize American infrastructure, revitalize the manufacturing industry and create jobs in the wake of the economic devastation caused by the coronavirus pandemic. Republicans oppose the hikes in Biden’s plan, as does moderate Democratic Senator Joe Manchin of West Virginia, a crucial swing vote in that chamber who has said a hike to 25% would be more appropriate. Last week, Biden said that he would be “willing to negotiate” a hike lower than the 28% corporate rate he campaigned on—so long as the plan can be paid for another way.
What To Watch For
Biden will meet with a bipartisan group of lawmakers on Monday afternoon to discuss his infrastructure plan.