Director Keith Hall Warns: “We Might Take A Hit” On GDP, Wage Growth, And Business Investment If Corporate Rate Is Raised

At the House Budget Committee’s first public hearing of 2019, the nonpartisan CBO issued an important warning: “Raising the corporate income tax rate…could slow down economic growth and wage increases.”

Congressional Budget Office Director Keith Hall said raising the corporate income tax rate…could slow down economic growth and wage increases.

He also said during a House Budget Committee hearing that it’s not clear that raising the tax above the current 21 percent rate would produce deficit savings.

“We might take a hit on [gross domestic product], we might take a hit actually on wage growth a little bit,” Hall said, responding to a question from Steve Womack of Arkansas, ranking Republican on the committee. Womack had asked what would happen if the tax were raised from 21 percent to 28 percent, as Budget Chairman John Yarmuth has suggested.

Hall said raising the tax would likely reduce business investment.

The historic results generated by historic tax reform only underscore the importance of the CBO’s new warning:

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