Treasury Secretary Janet Yellen will allegedly call for a global minimum corporate tax rate to stop U.S. companies from going to other nations in response to Biden’s upcoming tax hikes.
By convincing other nations to enforce a minimum tax, Yellen is admitting the risks to the economy if America acts alone in increasing corporate taxes.
The administration has proposed the largest tax increase in nearly 30 years to pay for Biden’s $2 trillion American Jobs Act — a bill marketed as funding America’s “infrastructure” but that really mostly finances major policy progressive agendas like fighting climate change and free education for certain groups.
The tax changes would raise America’s corporate tax rate from 21% to 28%, which conservatives say could devastate the middle class.
Yellen is expected to urge all other nations to raise their corporate tax rates to a minimum to ensure economic “competitiveness” globally.
“Competitiveness is about more than how American companies do against foreign companies,” an excerpt of Yellen’s prepared comments obtained by reporters reads. “It’s about ensuring that governments have enough resources to solve problems, and that all citizens share the responsibility of financing the government.”
“We are working with other G20 countries to set a global minimum rate that can prevent a race to the bottom,” she allegedly plans to say.
During Trump’s presidency, the Republican lowered the U.S. rate from 35% — a global high — to 21%, saying that the last rate put American companies at a global disadvantage and made many of them move their businesses to other nations.
According to the Tax Foundation, the global average corporate rate is right under 24%.
Author: Scott Dowdy