Senate Dems release corporate minimum tax proposal for spending bill

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The measure will apply to approximately 200 companies that report more than $1 billion in annual profits.

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Senate Democrats on Tuesday unveiled more details about their proposal to impose a 15% minimum tax on corporate profits as part of their efforts to cover the cost of President Biden’s massive social spending bill.

Censors Elizabeth Warren, D-Mass., Angus King, I-Men, and Ron Wyden, D-Ore. Introduced by the US, the measure would apply to nearly 200 companies that report more than $1 billion in annual profits, according to a fact sheet issued by lawmakers. Democrats said the proposal would generate hundreds of billions in tax revenue over a 10-year period.

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Censors Michael Bennett, D-Colo., Edward Markey, D-Mass., and Sheldon Whitehouse, D-RI, co-sponsored the proposal. Democratic leaders have pursued alternative ways of generating tax revenue, with moderates such as Sen. Kirsten Cinema indicating that they opposed changes to the corporate tax rate.

Democrats Plan Ultra-Billionaire Tax to Spend Bill

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Cinema said she supports the proposed minimum tax on corporate profits – a positive move for Democratic leaders who are scrambling to reach consensus and pass Biden’s signature legislation.

“This proposal represents a general step toward ensuring that highly profitable corporations – which can sometimes avoid the current corporate tax rate – pay a reasonable minimum corporate tax on their profits, such as Everyday Arizona and Arizona do small businesses,” Sinima said. “I look forward to continuing discussions with the White House and allies to expand economic opportunities, maintain America’s economic competitiveness, and help Arizona families move forward.”

The proposal would maintain certain business tax credits, such as incentives for clean energy and housing. Warren said all 50 Senate Democrats would support the proposal, meaning that moderate Sen. Joe Manchin is in favor of it. Additionally, Wyden said Treasury Secretary Janet Yellen confirmed that the proposal is in line with the global minimum tax on corporations.

Lawmakers said the current tax code has allowed many large companies to pay “little or no tax” on their perceived profits. He noted that Amazon made $45 billion in profits over the past three years, but paid an effective tax rate of “just 4.3% — below the 21% corporate tax rate.”

The proposal did not include additional details on an alleged “billionaire tax,” a separate measure that would impose an annual tax on billionaires’ unrealized investment gains.

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Wyden told reporters that more details on the billionaire proposal would be released later in the day.

This story has been updated.


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