You are using an older browser version. Please use a supported version for the best MSN experience.

'We gotta pay for this': Biden proposes corporate tax rises to pay for infrastructure projects

Sky News logo Sky News 09/04/2021

US President Joe Biden wants to raise taxes for companies to help pay for a massive spend on infrastructure.

Joe Biden wearing a suit and tie: US President Joe Biden says he is open to compromise on corporate tax rates © Reuters US President Joe Biden says he is open to compromise on corporate tax rates

The Made In America Tax Plan would raise $2.5trn (£1.8trn) over 15 years, according to the US Treasury.

It would include higher taxes on companies' overseas earnings, a minimum tax on profits reported to investors, and more tax enforcement.

It would also see the 21% corporate tax rate (set four years ago by Mr Biden's predecessor Donald Trump) raised to 28%.

Mr Biden has previously announced plans to spend more than $2trn (£1.4trn) on infrastructure over eight years.

Strategists at UBS said the plan to hike the corporate tax rate could weigh 7.4% on S&P 500 earnings.

Even if Mr Biden's tax plan does not get the approval of congress and the proposed corporate tax rate has to be watered down to 25%, it could still hit earnings by 3.6%, they added.

Video: Biden Admin Unveils Corporate Tax Hikes to Fund Infrastructure Plan (Cover Video)


The worst-hit sectors were likely to be technology and communications, with the worst-hit industries being consumer durables and apparel, and media and entertainment.

Mr Biden signalled there could be room for compromise in the corporate tax rate, saying: "We'll be open to good ideas in good faith negotiations.

"But here's what we won't be open to: We will not be open to doing nothing. Inaction, simply, is not an option.

"You think China is waiting around to invest in this digital infrastructure or on research and development? I promise you, they are not waiting. They're counting on American democracy to be too slow, too limited and too divided to keep pace."

He challenged the idea that low taxes would do more for growth than investing in care workers, roads, bridges, clean water, broadband, school buildings and the power grid.

He said he was willing to "listen" to proposals to keep the tax rate below 28% as long as projects are financed and taxes were not increased on those earning less than $400,000.

He added: "But we gotta pay for this. We gotta pay for this.

"There are many other ways we can do it. But I am willing to negotiate.

"I've come forward with the best, most rational way, in my view the fairest way, to pay for it, but there are many other ways as well. And I'm open."


More from Sky News

image beaconimage beaconimage beacon