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CEOs say proposed Biden tax hike would hurt competitiveness

CEOs say proposed Biden tax hike would hurt competitiveness
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Large-company CEOs who are members of a top business group share a nearly unanimous sentiment that President BidenJoe BidenBiden's quiet diplomacy under pressure as Israel-Hamas fighting intensifies Overnight Defense: Administration approves 5M arms sale to Israel | Biden backs ceasefire in call with Netanyahu | Military sexual assault reform push reaches turning point CDC mask update sparks confusion, opposition MORE's proposed tax hikes would hurt business competitiveness.

The internal survey from the Business Roundtable, which has come out forcefully against the tax hikes, found that 98 percent of its members thought the proposed tax hike would have moderately or very significant adverse effects on their companies' ability to compete. 

Three-fourths said it would hamper research and development investment, 71 percent said it would slow hiring and almost two-thirds said it would slow wage growth. 

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“The proposed tax increases on job creators would slow America’s recovery and hurt workers,” added Business Roundtable President Joshua Bolten.

“This survey tells us that increasing taxes on America’s largest employers would lead to a reduced ability to hire, slower wage growth for workers and reduced investments in research and development—all key components needed for a robust economic recovery."

Biden has proposed increasing corporate tax rates from 21 percent to 28 percent in order to pay for his $2.3 trillion infrastructure bill.

The Business Roundtable has strongly supported a major federal investment in infrastructure to upgrade roads, bridges, ports, transportation and telecommunications, but has been vociferous in its opposition to hiking corporate tax rates to pay for it.

In 2017, former President TrumpDonald TrumpGOP-led Maricopa County board decries election recount a 'sham' Analysis: Arpaio immigration patrol lawsuit to cost Arizona county at least 2 million Conservatives launch 'anti-cancel culture' advocacy organization MORE signed a tax cut lowering the rate from 35 percent to its current level. The Business Roundtable and other business groups pointed to the low unemployment rate and rising wages as evidence that the lower taxes helped spur the economy. 

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Critics, however, say that the tax cut led to little increased business investment, and say the economic benefits were a temporary uptick from the tax cuts' $1.9 trillion stimulus effects.

They also say that some alternative methods of paying for infrastructure, such as a gas or mileage tax, would be more regressive, putting a higher share of the burden on poorer members of society.

But even some key Democrats are opposing the 7-point increase in the corporate tax rate. Sen. Joe ManchinJoe ManchinSenators shed masks after CDC lifts mandate Manchin, Murkowski call for bipartisan Voting Rights Act reauthorization The Hill's Morning Report - Presented by Facebook - Israel-Hamas carnage worsens; Dems face SALT dilemma MORE (D-W.Va.), a pivotal swing vote, said the rate should increase to no higher than 25 percent.

Biden has signaled an openness to other ways of financing the bill, but said it should be paid for. Sen. Chris CoonsChris Andrew CoonsThe Hill's Morning Report - Presented by Facebook - Israel-Hamas carnage worsens; Dems face SALT dilemma Schumer in bind over fight to overhaul elections New York, New Jersey, California face long odds in scrapping SALT  MORE (D-Del.), a Biden ally, suggested last week that the total price tag was likely to come down, but that part of the package could be financed with increased federal borrowing.