For the last four years, the Biden-Harris administration pushed Congress to raise taxes on the American people. Every year, they proposed raising the top individual tax rate and increasing the U.S. corporate tax rate. Congressional Republicans consistently opposed these tax increases, arguing that the higher tax rates would hurt working families, American businesses, and the U.S. economy.
But now, anonymous White House sources are saying the President might be willing to support the Biden-Harris tax rate increases on individuals and American companies. These political aides apparently think this would blunt Democrats’ attacks on Republicans for cutting taxes and spending.
Have these political advisers been living under a rock for the last forty years? Democrats have been attacking Republicans for cutting taxes and spending since the Reagan administration. The Republican response has been a winning one—-lower tax rates increase economic growth, attract investment to America, increase wages for working families, and create jobs in America.
Increasing the tax rate on top earners and the corporate tax rate would result in U.S. top marginal tax rates that are among the highest in the developed world. Both the top U.S. personal tax rate and the U.S. corporate tax rate would be higher than the OECD average tax rates. These higher rates would make the U.S. tax code anti-growth and anti-competitive, and threaten the long term health of the U.S. economy.
Raising the corporate rate even a few points would increase the competitive advantage China’s tax code has over the U.S. A higher U.S. rate would be nearly twice as high as the 15% rate China levies on its most important business sectors competing against the U.S.
A higher corporate tax rate is also the most harmful tax increase for economic growth, and working families would be hit hard. The higher rates would reduce investment, wages, and jobs. Study after study has shown that a higher corporate rate depresses wages, and could cost the typical American household thousands of dollars a year.
If Congressional Republicans agree to raising the top individual rate and the corporate tax rate, the U.S. would end up with a worse tax system than the one we had under the Biden-Harris administration. Why would they ever do that?
Why Would Republicans Support the Biden/Harris Tax Increases?
April 05, 2025
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