The White House is assembling an infrastructure package that will likely be funded by new taxes on corporations and wealthy Americans — but the sweeping multitrillion-dollar plan could face opposition from members of President Biden's own party.
Several moderate Democrats on Monday raised concerns that Biden's proposed tax hikes, including raising the corporate tax rate to 28% from 21% and hiking the rate paid by high-income earners, could derail the nation's economic recovery from the coronavirus pandemic.
"We need to be careful not to do anything that's too big or too much in the middle of a pandemic and an economic crisis," Rep. Josh Gottheimer, D-N.J., told Axios.
House Speaker Nancy Pelosi can afford to lose just three Democratic votes if Republicans are unified in opposition, while Democrats need the support of all 50 members in the Senate to pass the measure, should they opt to approve it using budget reconciliation.
Although Gottheimer said he needs to see the overall package before commenting on specific tax rates, he suggested the measure needs to be "responsible" and should include input from both sides of the political aisle.
"This can't just be jammed through without input and consideration from the other side," he said.
Both Gottheimer and Rep. Tom Suozzi, D-N.Y., said they would not vote for any changes to the tax code unless Democrats agreed to restore unlimited write-offs of state and local taxes, or SALT. Repealing the $10,000 limit, however, would require Democrats to vote for something that's widely viewed as a tax cut for the wealthy in blue states like New Jersey and New York. Gottheimer and Suozzi did not respond to a FOX Business request for comment.
Biden is slated to travel to Pittsburgh on Wednesday to announce details of the next big-ticket economic package, which will serve as the basis of his "Build Back Better Plan," White House press secretary Jen Psaki told reporters on Monday. He will also lay out how he intends to pay for the package.
The president is planning to break up the legislative effort into two main components: One focused primarily on infrastructure and clean energy investments — which Biden will introduce on Wednesday — and a second centered on issues like child care and universal pre-kindergarten that will be rolled out in April, Psaki said.
The tax hikes are expected to be similarly divided; the infrastructure part of the bill would be funded by taxing corporations, including raising the corporate tax rate to 28%, increasing the global minimum tax paid from about 13% to 21%, ending federal subsidies for fossil fuel companies and forcing multinational companies to pay the U.S. tax rate rather than the lower rates offered by foreign subsidiaries, The Washington Post reported last week.
The second part of the legislation focused on domestic priorities, meanwhile, would be paid for by increasing the highest income tax rate from 37% to 39.6%, raising taxes on wealthy investors and limiting deductions that rich taxpayers can claim annually, the Post reported.