Biden: "Corporate Tax Hike Is an Economic Burden"... Yellen: "Corporate Tax to Be Discussed at G20 Level"

[Image source=Reuters Yonhap News]

[Asia Economy New York=Correspondent Baek Jong-min] U.S. President Joe Biden emphasized that the corporate tax rate increase he is pushing forward will not burden economic recovery. Treasury Secretary Janet Yellen announced that discussions are underway at the Group of Twenty (G20) level to raise the minimum corporate tax rate floor, and she predicted that the United States will reaffirm its economic leadership at this week’s World Bank (WB) and International Monetary Fund (IMF) annual meetings.

On the 5th (local time), President Biden responded to the question, "Do you think the corporate tax increase will burden economic recovery?" by saying, "Not at all."

President Biden also emphasized, "There is no evidence to suggest that. Over the past three years, 51 to 52 of the Fortune 500 companies paid no corporate tax at all."

He added, "The corporate tax rate used to be as high as 36%, but now it is only 21%." He stressed that the 28% corporate tax rate he proposed would not be a significant burden on businesses.

In his Easter message announced at the White House that day, President Biden also expressed his view to push for strong economic recovery policies, saying, "The virus has not disappeared yet, but dawn is approaching. We will rebuild the nation."

Yellen Pushes for International Solidarity on Corporate Tax Increase... Emphasizes Need for Economic Recovery in Developing Countries

The U.S. plan to raise corporate taxes is becoming an international issue.

Secretary Yellen stated that she is cooperating with the Group of Twenty (G20) to establish a minimum corporate tax rate floor.

According to the Treasury Department, Secretary Yellen said in a speech at the Chicago Council on Global Affairs (CCGA) that the 30-year competition among countries to lower corporate taxes must stop.

Regarding the tax increase policy, Secretary Yellen explained, "It is to ensure that the government can invest in essential public goods, respond to crises with a stable tax system, and that all citizens fairly share the fiscal burden."

Last week, President Biden announced a $2.25 trillion infrastructure investment plan and expressed his intention to encourage countries to raise their minimum corporate tax rates from 13% to 21%.

Treasury officials also stated that it is important for other major economies worldwide to adopt a corporate tax floor to make the policy effective, and that they will use domestic legislation to prevent companies from shifting profits to tax havens and encourage other countries to take similar measures.

The Wall Street Journal evaluated that if other countries also raise their corporate tax rates, companies based in the U.S. would suffer little damage compared to if only the U.S. raised its rates.

Secretary Yellen also emphasized U.S. international economic leadership. She stated that she will attend the International Monetary Fund (IMF) and World Bank (WB) meetings this week to discuss progress on climate change, improving access to COVID-19 vaccines, and incentives to support a strong global economic recovery.

Secretary Yellen emphasized the need for stable global economic growth that benefits the U.S. economy and pledged that the U.S. will lead global economic development.

Secretary Yellen stressed, "The economic success of developing countries also benefits American consumers." She also mentioned the need for cooperation, noting that vulnerabilities remain in non-financial sectors and that countries must pay attention to new risks.

This content was produced with the assistance of AI translation services.