President Biden announced his spending proposals of more than $ 4.5 billion and the accompanying tax hikes as an investment in “rule the world rather than let it slip away. Yet, paradoxically, a new analysis exposes a huge way in which Biden’s plans would make the United States less competitive in the global market to organise.
The key to funding spending plans is a proposed increase in the corporate tax rate from 21% to 26.5%. Factoring in state corporation tax, the average corporate tax rate in the United States would reach a whopping 30.9%. And according to a new tax foundation analysis, this punitive level of corporate tax would be the third highest corporate tax rate among developed countries, surpassed only by Colombia and Portugal.
Why is it a problem?
Well, the United States would become a less attractive place for business investment, which is bad news for entrepreneurs, workers and customers. Companies would naturally be less likely to do business in the United States when they could go to dozens of other developed countries with lower tax rates. As a result, our economic competitiveness would suffer.
“Coming back close to the OECD summit for corporate tax rates… would discourage investment and encourage companies to shift their profits and locate elsewhere, resulting in fewer job opportunities for Americans and less tax revenue for the US government, ”analyzes the analysis. Explain.
Biden says his tax and spending program is meant to reaffirm America’s dominance. But the costly tax hikes demanded by the president would put our economic competitiveness back on the world stage. It is not “Build back better”, it is shooting us in the foot.
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