President Joe Biden speaks to reporters when he visits James Cancer Hospital and the Solove Research Institute in Columbus, Ohio on March 23, 2021.
Leah Millis | Reuters
Stakeholders from across the political spectrum are preparing for an all-out war over President Joe Biden’s upcoming tax reform proposal, which is expected to include tax increases for wealthier families and businesses as part of his massive infrastructure plan.
It will become the “Super Bowl of Tax Reform,” according to one person planning to join the fight. This person, who refused to be called to speak freely, is in for a “protracted battle”.
These are some of the groups that, according to interviews with their leaders and representatives, will be involved in the struggle:
Americans for Prosperity, part of the Koch networkAmericans for Tax Reform, a conservative groupOur Revolution, a progressive group that emerged from Sen. Bernie Sanders’ 2016 campaignAmericans for Tax FairnessProgressive Change Campaign CommitteePatriotic Millionaires, a liberal tax collection group on the rich
Biden has said since his campaign that he wants to increase taxes for those who earn more than $ 400,000 a year and that he wants to increase the corporate tax rate from 21% to 28%. The president also wants to tax long-term capital gains at the same tax rate as wages for households making more than $ 1 million a year.
Several reports indicate that Biden is considering using these tax increases to at least partially pay for the infrastructure package, which is expected to cost over $ 2 trillion.
Conservative and libertarian groups made the adoption of former President Donald Trump’s tax plan a top priority at the start of this administration. With the exception of the then-Sen, all Senate Republican lawmakers voted yes to the 2017 bill. John McCain, R-Ariz., Who was absent from his battle with cancer.
Now such groups, including those backed by billionaire Charles Koch, are preparing to crack down on Biden’s tax reform proposal.
The plan on the right
The Koch network, through its political advocacy group “Americans for Prosperity”, has made maintaining Trump’s tax cuts part of its agenda under the new administration and the new Congress. Democrats also control the House and Senate, albeit with a narrow margin.
The group warns that a tax hike will weigh on a recovering economy that has taken a heavy blow from the coronavirus pandemic.
“The Tax Cut and Jobs Bill has been a tremendous asset to the American people and has helped them keep more of what it deserves for their families, businesses and communities,” AFP President Tim Phillips told CNBC. “Reclaiming those cuts or adding new taxes would worsen our already shattered economy, affect workers’ wages, smash small businesses, and ultimately go nowhere near paying for the partisan wish list proposed by President Biden and the leaders of Congress.”
Trump’s tax cuts lowered the company’s rate from 35% to 21%.
A person familiar with the matter said AFP had already taken tax and other economic policies with the offices of lawmakers on both sides of the aisle. This person would not specify which offices.
In one of the group’s digital advertisements, only “no tax increase” is requested.
Americans for Tax Reform, founded by anti-tax crusader Grover Norquist, has for years pushed back all attempts to raise taxes. The group has been a strong advocate of Trump’s tax cuts and is already promoting some ways to attack Biden’s plan on its website.
Norquist, the group’s president, told CNBC that Americans for Tax Reform plans to use national and regional options to convince voters that the Biden tax plan will affect their 401 (k) s, utility bills and other personal Data would have article.
He hopes that such an approach will put pressure on moderate Democrats to oppose or water down the tax proposals. Democrats have a slim majority in the Senate due to Vice President Kamala Harris being tied.
“Our plans are full court press to make it the most expensive vote,” said Norquist. “They want to make it so politically expensive that people reduce the size and scope of the legislation.”
The campaign, he added, will “move forward in the hope that you will make it so successful that they say we will not do it until next year, not this year”.
Norquist suggested that Sens. Catherine Cortez Masto, D-Nev., And Mark Kelly, D-Ariz., Who are up for re-election in 2022, might feel pressure from his group’s efforts. Cortez Masto and Kelly representatives have not returned requests for comment.
Senator Joe Manchin, DW.Va., who cannot be re-elected next year, said he supported a large-scale infrastructure move that he believed should include increasing the corporate tax rate to around 25%.
How the left will play it
Across the aisle, progressive organizations see an opportunity to meet one of their top priorities: raising taxes for the rich. The struggles of working and middle-class families during the pandemic show that the time has come to enact comprehensive tax reform targeting the rich, they argue.
Democratic lawmakers and liberal organizations pushing for higher taxes on the corporate and wealthy often cite opinion polls that have many voters in favor of them.
A 2020 Reuters / Ipsos poll found that 64% strongly or reasonably believed that “the very rich should contribute an additional percentage of their total wealth to support public programs each year.”
Our Revolution, a progressive organization led by Sanders, is planning a widespread grassroots effort to convince lawmakers of both parties to support the tax hike for the rich. Sanders, who describes himself as a democratic socialist, has urged the rich to pay more taxes for years. The Vermont Senator, along with Democrats including Massachusetts Senator Elizabeth Warren, recently proposed an overall 3% annual tax on assets over $ 1 billion.
Paco Fabian, campaign leader at Our Revolution, said the teams will be doing phone banking as part of this effort.
“Businesses and the rich have to pay their fair share. We made an incredible amount of pandemic profits while people lost their jobs and health care,” said Fabian, describing the message the group will convey to lawmakers during public relations.
The Progressive Change Campaigns Committee, coordinated with Warren, said it would be active behind the scenes on the issue.
“For the ‘Better Back Down’ debate, we’ll be doing things like polls, communicating behind the scenes with Democratic lawmakers, and making sure our national membership and the general public are fully buoyed,” said Adam Green, co-founder of the group on the name gave Biden his infrastructure plan.
He said the organization plans to liaise with the White House and members of the House and Senate.
Green said his group wanted the White House to focus on raising taxes for the richest Americans – but avoiding a gas tax.
“The best way for the White House to be brave and keep the peace in the country on the tax front is to focus on progressive taxes, namely the rich and corporations, rather than regressive measures like a gas tax,” he said.