Tax hikes are back on the menu under President Joe Biden. The question for the Granite State is how hard will they hit here? Hard enough to convince either Democratic Sens. Maggie Hassan or Jeanne Shaheen to block them? In a 50-50 Senate, a single senator can hold up any piece of partisan legislation.
In order to fund its new $2.25 trillion infrastructure program, the Biden administration is planning to raise the corporate tax rate by 33 percent, a move economists warn could slow the economy as it is recovering from the coronavirus pandemic.
Biden says the money will go to cover what he calls an “infrastructure bill,” though less than 6 percent of the money goes to roads and bridges. A ruling by the U.S. Senate parliamentarian would allow Democrats to pass the legislation with just 51 votes via the reconciliation process. The result would be more than $4.27 trillion in spending via a simple majority vote under the Biden administration.
In an interview with West Virginia Metro News, Democrat Sen. Joe Manchin, a key player in a narrowly divided Senate, balked at the tax hike proposal. “As the bill exists today, it needs to be changed,” he said. The West Virginia moderate said he supports a middle ground corporate tax rate of 25 percent.
“If I don’t vote to get on it, it’s not going anywhere,” Manchin said. “So we’re going to have some leverage here. And it’s more than just me… there are six or seven other Democrats who feel very strongly about this.”
Who are those other “six or seven” Democrats opposed to the Biden tax proposal? Manchin wouldn’t say, and the offices of Hassan and Shaheen declined to respond when NHJournal asked if they were on the list.
In tax-averse New Hampshire, what would voting for one of the largest business tax hikes in history mean for Hassan during her 2022 re-election bid?
According to the Tax Foundation, New Hampshire’s corporate tax rate is 7.7 percent, lower than our neighbors in Vermont (8.5 percent), Maine (8.93 percent), and Massachusetts (8 percent). Add the Biden 28 percent and that would mean some Granite State businesses would have a tax rate of nearly 36 percent.
Neil Bradley, Executive vice president and chief policy pfficer of the U.S. Chamber of Commerce, thinks the proposed tax hike is “dangerously misguided.”
“We need a big and bold program to modernize our nation’s crumbling infrastructure and we applaud the Biden administration for making infrastructure a top priority,” Bradley said in a statement. “However, we believe the proposal is dangerously misguided when it comes to how to pay for infrastructure.”
“We strongly oppose the general tax increases proposed by the administration which will slow the economic recovery and make the U.S. less competitive globally – the exact opposite of the goals of the infrastructure plan,” Bradley said.
Drew Cline, president of the Josiah Bartlett Center for Public Policy, thinks the Biden corporate tax rate hike, combined with Treasury Secretary Janet Yellen’s push to create one global corporate tax rate is particularly troubling.
“Basically what the Biden Administration is saying is ‘we want to dramatically raise taxes on American businesses and collude with other nations to make sure that American business has nowhere else to flee to when we do raise their taxes,’” Cline told the NHJournal.
“If you have to collude with other global governments to prevent your own people from leaving because you’re going to overtax them, then maybe you should rethink overtaxing them,” Cline added.
