The Trump campaign issued a statement on Monday, criticizing President Biden’s proposal to increase the corporate tax rate, claiming it would lead to a significant loss of jobs. Biden’s plan, outlined in his $7.3 trillion budget proposal for the 2025 fiscal year, seeks to raise the corporate tax rate on billion-dollar companies from 15% to 21%, with an overall goal of 28%. Additionally, Biden aims to implement a minimum 25% tax on the unrealized income of the wealthiest households.
According to the Trump campaign, this hike in corporate taxes would result in the immediate loss of around 1 million American jobs within the first two years, followed by a continuous decline of 600,000 jobs annually over the subsequent decade. The campaign referenced a study conducted by Rice University economists John W. Diamond and George R. Zodrow, commissioned by the National Association of Manufacturers, to support their claims.
Highlighting comparisons with global tax rates, the campaign pointed out that such an increase would elevate the combined state and federal corporate tax rate in the United States to 32.8%, significantly surpassing rates in other nations and notably exceeding China’s. They cited a report from the National Retail Federation to emphasize the disparity.
The Trump campaign lauded the 2017 Tax Cut and Jobs Act, which they asserted had primarily benefited working and middle-class individuals. They stated that individuals earning less than $50,000 a year experienced tax cuts of up to 26%, while those earning under $100,000 saw reductions of up to 17%. Additionally, the legislation reduced the corporate tax rate from 35%—then one of the highest among OECD nations—to 21%, aligning it more closely with international standards and purportedly enhancing the competitiveness of American companies.
Citing the implications of a 28% corporate tax rate, the campaign claimed that one-third of the burden would ultimately be borne by workers, resulting from job losses and reduced wages, as indicated by the aforementioned study.
