Kelly Blasts Biden Tax Hike Scheme as President Comes to Pittsburgh

WASHINGTON -- In Pittsburgh today, President Joe Biden will unveil a portion of his multi-trillion dollar infrastructure package that would impose one of the largest tax increases in American history. This part of the plan calls for $2 trillion in new spending and tax hikes on American workers and employers.

U.S. Representative Mike Kelly (R-Pa.), a senior member of the Ways and Means Committee and one of the architects of the Tax Cuts and Jobs Act, issued this statement on the president's proposal:

"President Biden has called for massive new spending and one of the largest tax increases in American history just as we are climbing out of the lockdown recession. Biden’s proposal will take more money from workers, families, and small businesses, leading to lower wages and more jobs being sent overseas. America needs creative, bipartisan solutions to modernize America's aging infrastructure that spur investment, not higher taxes on hard-working Americans."

Background

Democrats’ tax hikes will hurt American workers.

  • Ordinary Americans will shoulder a significant portion of Biden’s corporate tax hike. There’s no hiding the fact that this tax hike will take a bite out of Americans’ paycheck.
  • Nonpartisan congressional budget scorekeepers estimate that workers will bear about 25 percent of the Biden tax increase, while other economic experts put that share much higher, at 50 percent, or even 70 percent
  • Even workers in the bottom 20 percent of earners would on average see a cut in paychecks in the long run.

Democrats’ tax hikes mean lower wages and less growth.

  • According to the Tax Foundation, Biden’s corporate rate increase alone will eliminate 159,000 jobs and reduce wages by 0.7 percent.
  • Biden’s tax hike to 28 percent, in addition to state taxes, would drag the United States back to having the highest combined corporate tax rate in the developed world, 9 percentage points higher than the average of developed nations.
  • This could reduce our economic growth by 0.8% and the capital stock by 2.1 percent.

Democrats’ tax hikes target small businesses.

  • Nearly 1 million small businesses in our country are organized as “C corporations.” Biden’s proposal would increase their tax rate by 33 percent, at a time when many small businesses are struggling to recover from the pandemic.
  • Many other American small businesses pay taxes as individuals, so Democrats’ forthcoming individual tax increases will ensure that no small business is exempt from Biden’s tax hikes.

Democrats’ tax hikes will send jobs and businesses overseas.

  • Under our prior broken tax code, hundreds of billions of dollars and hundreds of companies each year fled to foreign countries.
  • Republicans’ 2017 tax reform reversed that trend, bringing back companies and foreign earnings to be invested in the U.S.
  • President Biden’s corporate tax proposal would turn back the clock and forfeit those gains.

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