The latest proposal from the Biden administration shows just out of touch they are. On Monday Treasury Secretary Jante Yellen revealed the new plan to require all countri8es to have a minimum corporate tax because Biden’s plan to raise it to 28% means our country will have a hard time selling our products globally.
The reason this idea is idiotic is that no country that will profit from our high tax rate will be willing to give up that advantage.
But the tax increase Biden is proposing is now unlikely to pass because Democratic Sen Joe Manchin opposes the higher tax and he says other Democrats will follow his lead. Biden is trying to sell as a tax on the rich but that is a lie because the tax increase will result in higher prices.
On top of that, inflation could raise its ugly head. In the end, it’s the consumer that will pay the price for the tax increase.
If we raise the corporate tax to 28% our tax rate would be almost double what our trading partners have. Residents of any country that agrees to a hefty tax increase would incur the wrath of their citizens.
Economically it would be a terrible mistake on their part if they do raise the corporate rate. It would be politically and economically suicide. I don’t believe the G20 will go along with it. I think it is smoke and mirrors on their part to sell then tax increase.
Treasury Secretary Janet Yellen called for a global minimum corporate tax rate on Monday, a pitch that comes as the Biden administration begins to sell its roughly $2 trillion infrastructure and jobs proposal that would raise US corporate taxes to fund the massive plan.
“We’re working with G20 nations to agree to a global minimum corporate tax rate that can stop the race to the bottom. Together, we can use global minimum tax to make sure that the global economy thrives, based on a more level playing field in the taxation of multinational corporations and spurs innovation, growth and prosperity,” Yellen said in a speech to the Chicago Council on Global Affairs.
“Competitiveness is about more than how U.S.-headquartered companies fare against other companies in global merger and acquisition bids,” she said during the remarks, which represented her first major address as Treasury secretary.
“It’s about making sure that governments have stable tax systems that raise sufficient revenue to invest in essential public goods and respond to crises, and that all citizens fairly share the burden of financing government.”
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Author: Steven Ahle
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