Urges former colleagues to “eliminate wasteful loopholes rather than our country’s new competitive corporate rate and the jobs it generates”
WASHINGTON, D.C. – Former United States Senator Blanche Lincoln (D-AR) today submitted testimony for the record of the U.S. Senate Finance Committee’s hearing on “How U.S. International Tax Policy Impacts American Workers, Jobs, and Investment.”
After detailing the meaningful economic wins generated by our country’s new globally competitive corporate tax rate of 21 percent – including an unemployment rate consistently below 4 percent, more than 100,000 new private sector jobs per month, and nominal wage growth at or above 3 percent growth for nearly two straight years – Senator Lincoln cautions her former colleagues on the Committee about the harm of raising the federal corporate income tax rate by more than 33 percent. “Such a plan would immediately halt domestic investment and send jobs overseas – both of which pose serious barriers to the country’s capacity to build back better.”
As Senator Lincoln adds in her testimony, “when combined with state and local taxes, job creators in the United States already pay a corporate rate of over 25 percent. The average corporate rate among OECD countries, meanwhile, is 23.4 percent – and 25 percent in China.” “Nearly a dozen countries around the world have also reduced their corporate rates in recent years, which threatens to compound the consequences of any new proposal to put ourselves even further behind foreign competitors.”
As much as 70 percent of corporate taxes – which, per the OECD, “are the most harmful type of tax for economic growth” – are borne by labor. And as Senator Lincoln notes, “analysts from the Tax Foundation to the Tax Policy Center agree that workers pay the cost in the form of lower wages.”
Click here to view Senator Lincoln’s testimony and corresponding state by state table, which breaks down how the proposed 28 percent federal rate is but the base of the burden once state and local corporate rates are accounted for.
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BACKGROUND:
- Senator Blanche Lincoln, a former U.S. Senator from Arkansas and RATE Coalition advisor, served on the Senate Finance Committee between 2001 and 2010.
- The RATE Coalition’s members and affiliates employ more than 53 million American workers in all 50 states.
