President Joe Biden learned nothing from the failures experienced while he was vice president and the corporate tax rate was at 35% if he wants to once again raise the taxes after former President Donald Trump worked to drop them, Americans for Tax Reform President Grover Norquist said Tuesday.
“When they had a 35% corporate rate, in Biden and (Barack) Obama’s presidency, companies were inverting and being bought by other companies and were moving their headquarters overseas because our rate was higher than theirs,” Norquist said during an appearance on Fox Business “Mornings With Maria.”
“We were at 35%, communist China was at 25%, and the European averages were under 25%.”
In addition, the United States, unlike France, China, or other countries, also have state corporate tax rates.
“The average corporate income tax rate at the state level, state and local level, is 4.8%,” said Norquist.
At that rate, when Biden says he’s only taking the tax rate to 28%, which isn’t much above those in China and Europe charge, he added, that doesn’t take into account a state tax rate of around 5%, which then brings the tax rate up to 33% again.
“That is significantly higher than China at 25%, Europe at 23.5%, or some of the other countries in Europe that are down below 10%,” said Norquist. “It’s not surprising that 98% of CEOs with the business roundtable say this is bad for competitiveness.”
The Biden administration also talks about “how they are going to invest less, pay people less,” he said. “Everything that was moving in the right direction in 2019 before COVID is going to go back the other direction.”
The United States now charges a corporate tax rate of 21%, which was reduced from the Obama-era 35% by the 2017 Tax Cuts and Jobs Act passed under Trump.
And when the tax rate came down to 21%, that resulted in national median pay increases, said Norquist.
“In 2019 alpine, in that one year, the median income of the American family increased by $4,440,” he said. “It was a 6.8% increase in the median family income.”
But under Obama and Biden, over the whole 8-year period, “they increased the median income by 5%,” he added. “Biden wants to go back the other direction, which will undo that progress, and he acts as if it costs absolutely nothing or that nobody is going to feel it.”
In addition, “90% of Americans saw their utility bills go down when the corporate rate was cut under the Republicans,” said Norquist. “If you’re a utility (company), you have to pass on the higher taxes to your utility customers and they see higher rates when taxes go up. They saw lower rates when taxes went down, so you’re hitting lots of people, not just a few.”
Income taxes will also go up under Biden if his plans are approved, said show host Maria Bartiromo. Initially, Biden said the taxes would only go up for people making $400,000 or more, but White House press secretary Jen Psaki later clarified that to say the tax raises are for families making that much, not individuals.
Biden has also said he wants to double the capital gains tax to bring it to par with ordinary income, said Norquist, but that will bring it back to “the kind of rates we had when Jimmy Carter was president, with double-digit inflation year after year.”
“He wants to add, get rid of the stepped-up in base which adds a second layer to the death tax,” said Norquist.
“That is one more bite at the apple if you’re trying to pass something on to your children. He wants to take the top rates up but not index them for inflation…when he talks about taking the top individual rate, that half of American business income is inside the personal income tax, not inside the corporate rate, so this is a significant tax increase on small businesses people who run their own business but through their personal income tax.”
Source: Newmax
