Quick Hit:

President Biden's proposed increase in the corporate tax rate to 28% is projected to result in significant job losses, starkly contrasting with the job growth seen under President Trump's Tax Cuts and Jobs Act.

Key Details:

The proposed hike to a 28% corporate tax rate could lead to an immediate loss of about 1 million American jobs in the first two years, with ongoing losses of 600,000 jobs annually over the next decade.
Under President Trump, the Tax Cuts and Jobs Act of 2017 reduced the corporate tax rate from 35% to 21%, aligning the U.S. more closely with other OECD countries and boosting competitiveness.
The planned increase to 28% would elevate the U.S. combined state and federal corporate tax rate to 32.8%, one of the highest globally and triple that of China.

Diving Deeper:

The Biden administration's proposal to increase the corporate tax rate from 21% to 28% marks a sharp departure from the pro-growth policies of the Trump era, which prioritized job creation and economic expansion. This shift not only threatens to reverse the gains made but also positions the United States unfavorably in the global economic arena.

During President Trump's tenure, the Tax Cuts and Jobs Act of 2017 was a cornerstone of economic policy, slashing the corporate tax rate from 35% to 21%. This historic reform invigorated the American economy, significantly benefiting the working and middle classes. Taxpayers earning under $50,000 a year saw cuts up to 26%, and those earning under $100,000 received reductions up to 17%. These cuts stimulated job growth, bolstered domestic investment, and enhanced the global competitiveness of American businesses.

In stark contrast, Biden's proposed tax hike, by elevating the corporate tax rate to 28%, threatens to impede economic progress. Analysis suggests that such an increase would result in a loss of approximately 1 million jobs in the first two years, with a continual decline of 600,000 jobs each year over the subsequent decade. This approach not only jeopardizes the livelihoods of countless Americans but also undermines the economic strides made in recent years.

Furthermore, the impact of the tax hike extends beyond immediate job losses. Approximately one-third of the burden from the increased corporate tax rate would fall on workers, manifesting as both job cuts and reduced wages. The shift to a 32.8% combined state and federal corporate tax rate, among the highest in the world, starkly contrasts with the more competitive rates of our global rivals, including China.

The Biden administration's proposed tax increase poses a significant threat to the economic stability and job security of American workers. It marks a clear departure from the pro-worker, pro-growth policies of the Trump administration, underscoring the need for policies that prioritize economic prosperity and global competitiveness.