Democrats see a political winner in the tax fight

As President BidenJoe BidenBiden calls on California workplace safety leader to lead OSHA Romney blasts end of filibuster, expanding US SCOTUS cash payments to help reduce migration MORE running with a gigantic plan to strengthen the nation’s infrastructure, Democrats bet they will get a political boost from an accompanying proposal: tax increases designed to bear the massive costs.

Biden on Wednesday highlighted a list of tax reforms aimed at raising $ 2.5 trillion – much of it for large corporations – to cover new infrastructure spending. The proposal was quickly fried by Republicans, who long ago described Democrats as the higher-tax party and now warn that Biden’s plan will affect small businesses and kill American jobs.

However, national polls have consistently revealed that tax increases on corporations and other wealthy taxpayers enjoy strong support among a wide range of voters, including independents. And some Democrats are practically salivating at the prospect of bringing that debate to the national stage to highlight the GOP’s resistance to a popular concept.

“If they are fighting the infrastructure bill to require companies to pay more in taxes, it is a total failure,” said Rep. John YarmuthJohn Allen Yarmuth: McConnell beats Kentucky Democrat for supporting Democrats who oppose, and Democrats swear to become “bold” – with or without the GOP’s Democratic majority shrinks, but finds unity MORE (D-Ky.), Chairman of the Committee on Budgets, said in a telephone interview this week.

“It’s just a kind of pointless argument, and I think that’s an indication of how vulnerable Republicans are in this issue,” he added. “The problem is perfect for those like us who promote significant investment in infrastructure and say to large corporations, ‘Because your business depends on infrastructure, you can do more to pay for it.’ “

The idea is hardly new. Democrats have been trying for decades to close the tax avoidance gaps enjoyed by corporations and other wealthy taxpayers, largely to no avail. Republicans in 2017 were also able to extend these benefits as part of the former President TrumpDonald Trump Romney blasts end of filibuster, SCOTUS McConnell expansion, GOP criticizes Biden’s executive order on US SCOTUS raises concerns about Iran’s seriousness in nuclear talks MOREthe tax revision, which included a reduction in the corporate rate from 35 to 21 percent.

But after a year of turmoil caused by the coronavirus crisis – when stocks rose but millions of low-income workers lost their jobs – Democrats believe the unequal economic impact of the pandemic has changed public opinion enough in their favor to makes controversial tax increases a political asset.

Indeed, a new Morning Consult / Politico poll found that 54 percent of voters support large improvements in infrastructure funded by tax increases, including 73 percent of Democrats and 52 percent of independents.

“When larger corporations avoid taxes or pay an average net rate of about 7 or 8 percent, smaller businesses and individuals need to make a difference,” Rep. And KildeeDaniel (Dan) Timothy KildeeLegists say producers are in a better position to deal with future pandemics Hill’s Morning Report – Presented by Facebook – Biden to get on track, backs COVID-19 aid law Democratic majority shrinks but finds unit MORE (D-Mich.), A senior member of the Committee on Ways and Means of Writing Taxes, told The Hill. “So I think that as far as payments are concerned, it’s also about fiscal fairness.”

As ammunition, Democrats point to a recent report by the Institute for Taxation and Economic Policy, a progressive think tank, that found that 55 of the nation’s largest corporations – including Nike, FedEx and Salesforce – failed to pay federal taxes in 2020, despite pre-tax profits. In some cases, companies received a substantial federal rebate.

The report recalled last year’s revelation that Trump, a self-proclaimed billionaire, paid only $ 750 in federal income tax in both 2016 and 2017. Both reports angered Democrats who promise to create a fairer system – and all but the bold Republicans. to protect the fiscal gaps that favor the rich.

“Highways are not free. And corporate freeladers – such as the 55 large profitable corporations that paid no federal income tax in 2020 – should pay for the infrastructure and other services they depend on, ”said Rep. Lloyd DoggettLloyd Alton Doggett Progresses in increasing pressure on Biden to support waiver of vaccine patent COVID House adopts bills offering citizenship path for Dreamers, House Republican farm workers attend hearings while driving car MORE (D-Texas), another senior member of the Ways and Means panel, said in an email.

Revealed Wednesday, Biden’s fiscal plan contains a series of reforms designed to force large corporations and businesses to contribute a higher share of profits to the federal government. It does so largely by increasing the corporate tax rate from 21 to 28 percent; banning companies from transferring profits to low-tax havens abroad; and the creation of a new minimum tax of 15% for large companies that report investor profits, but not obligations to the IRS.

Secretary of the Treasury Janet YellenJanet Louise Yellen Five payments from Biden’s first budget proposal Biden’s defense budget criticized by Republicans, progressives alike Biden proposes 2B increase in IRS budget MORE informed House Democrats on Tuesday of the proposal. And Speaker Nancy PelosiNancy Pelosi China’s growing threat to the trial, Pelosi plans to step down until Trump wins election: Biden report: “Prince Philip has happily dedicated himself to the people of Britain” MORE (D-California) said on Thursday that Democrats hope to move the entire package – infrastructure provisions and taxes alike – through Congress and to Biden’s office by August.

The president is open to policy suggestions from lawmakers on both sides, Pelosi said. “But it can’t be too small,” she added, “because what we’re talking about now has to be transformative and it has to be big.”

Democratic leaders are looking for a delicate balance. While the Liberals in the party support massive spending on new infrastructure – even pushing Biden to go further than his $ 2 trillion proposal – party moderators are paying close attention to both the size of the package and the effects on deficit spending.

“Does it really have to be a $ 2 trillion package right now? I don’t think we should admit this, “said an aide to a centrist Democrat in the House. “At least we should try to pay as much of this as possible.”

They can afford few malfunctions.

Pelosi has only a thin majority in the razor, made even thinner by the recent death of Rep. Alcee HastingsAlcee (Judge) Lamar Hastings Hill’s Morning Report – Biden raises vaccine eligibility amid “life or death” race Biden deplores passing Alcee Hastings Pelosi’s representative laments Hastings as “champion for our nation’s most vulnerable” MORE (D-Fla.). And the split is even 50-50 in the Senate, where Sen. Joe ManchinJoe ManchinRomney blasts end of filibuster, SCOTUS expansion Five rounds of Biden’s first budget proposal, Parkland’s parents pressure Manchin on gun reform: “You represent the nation” MORE, a moderate Democrat from West Virginia, is already flexing his oversized influence to oppose Biden’s plan to raise the corporate rate to 28%.

These internal frictions have not been overlooked by Republicans, who are fighting to make the fiscal package as uncomfortable as possible for centrist Democrats in the harsh battlefield districts.

Given this, Republicans this week highlight another report, sponsored by the National Producers Association, which predicts that a 28% increase in the corporate rate – combined with the elimination of several other corporate benefits – would cost the country 1 million jobs. in just two years. And the arm of the Republican campaign has jumped, launching a broad e-mail campaign linking vulnerable Democrats across the country to the threat of high unemployment posed by Biden’s proposal.

“No president has ever raised business taxes to rebuild an economy,” said Rep. Kevin BradyKevin Patrick Brady Hill’s Morning Report – Biden Could Find Zero GOP Support for Job Plan GOP Seeks New Line of Attack on Biden Business Plans Calls Rise from MPs for IRS to Extend Deadline (Texas), a senior Republican on the Ways and Means Committee, told CNBC this week. “At the end of the day, we will see slower hiring, [and] we will see less investment in the US “

Democrats go crazy. Infrastructure was among only three named political priorities that they supported in the wake of the 2018 campaign, when they gained control of the House. And after the improvement of COVID-19, it remains Biden’s main internal priority, which is already using the aggressor pulpit in an effort to sell its plan to the general public.

If the early debate is a clue, the Democrats’ argument will be based on the concept of “fairness.”

“You have Amazon – whose business is built on the right infrastructure – and paid 1.2% last year and zero [percent] the two years before. And they made $ 30 billion, “said Yarmuth.

“It’s not right in anyone’s book.”