Adewale Adeyemo, assistant secretary of the Treasury, Janet Yellen, said Wednesday that an increase in the U.S. corporate tax rate to 28% will not make American companies less competitive as the Biden administration is confident of gaining support from developed nations for setting a minimum global tax to be able to.
“We worked very closely with our international colleagues to counter the race for international taxes,” Adeyemo, who passed Wally, told CNBC’s Sara Eisen.
“We believe in both of the things that we will do about the G-20 globally. The US has made it clear that we are back and we look forward to leading the world. We are able.” reach an agreement that will cause the vast majority of the world’s developed countries to set a minimum tax, “Tax Official No. 2 said.
Yellen said Monday that it is working with the Group of 20 Nations to create a minimum corporate tax that will discourage companies from moving overseas to find lower tax rates. President Joe Biden has made the US corporate tax rate hike a key mechanism in funding his massive $ 2 trillion infrastructure plan.
The Republican Party is also largely opposed to reversing former President Donald Trump’s 2017 tax cuts, which cut corporate tax rates from 35% to 21%. Biden’s plan would not only partially reverse the corporate tax cut, but also meet other key provisions of the Trump Tax Cuts and Jobs Act.
The president opened the door on Wednesday to compromise his proposed corporate tax hike, but said the U.S. must respond boldly to infrastructure if it is to keep up with nations like China.
Defending the Biden government’s far-reaching infrastructure plan, Adeyemo said the US needs investments beyond repairs to roads and bridges to be globally competitive in modern times.
“The investments that the president is calling for in the jobs package are the same investments that the Chinese and other countries are making,” Adeyemo said. “It’s important that we make them now to ensure America can keep up in the 21st century.”
He said Biden’s plan and the White House’s broader definition of infrastructure were favored not only by progressive politicians but Wall Street executives as well.
Asked to address criticism that the one-off plan was both too extensive and insufficiently focused, Adeyemo pushed back.
“The pandemic has taught us that we need to think not only about traditional infrastructure, namely roads, bridges and ports, but also think about what we need to be competitive in the 21st century, including broadband.” Adeyemo said.
“One of the groups hit the most by Covid-19 were those who had to take care of others because they couldn’t join the workforce,” he added. “A number of the investments we’re making here are about making sure these people have the support and infrastructure to make sure they can return to the workforce and contribute to the economy.”
Adeyemo’s comments came a week after Biden first released his long-promised infrastructure proposal in Pittsburgh.
The American employment plan, if passed, would invest hundreds of billions of dollars in transportation infrastructure, water systems, broadband access, power grids, vocational training, and other regulations. It calls for $ 400 billion to care for elderly and disabled Americans, and $ 300 billion to build and upgrade affordable housing.
Republicans are practically in agreement in their opposition to the written plan and consider the legislation far too expansive given the $ 1.9 trillion Covid-19 aid package that the Democrats navigated through Congress earlier this year.
Both Yellen and Adeyemo made black history as the first woman to head the agency and first assistant secretary at the Treasury Department.