Harris to Raise US Corporate Tax Rate to 28% During Administration

Kamala Harris, the Democratic presidential candidate and Vice President of the United States, has announced plans to raise the corporate tax rate to 28% if elected. This move contrasts with Republican presidential candidate and former President Donald Trump, who has signaled intentions to lower corporate taxes. While this is positive for securing government finances, strong opposition from corporations is expected.

James Singer, a spokesperson for the Harris campaign, made the announcement on the 19th (local time) ahead of the Democratic National Convention. Singer described it as "a fiscally responsible plan that puts money back into workers' pockets and ensures that billionaires and large corporations pay their fair share." The current corporate tax rate is 21%, set to expire at the end of next year.

This policy aligns with President Joe Biden's approach. President Biden has previously stated plans to raise the current 21% corporate tax rate to 28%, increasing the tax burden on high-income earners while reducing it for the middle and lower classes. Earlier, Vice President Harris had advocated during the primary process for raising the corporate tax rate to 35%, the previous level, but as the new Democratic presidential candidate, she appears to have adopted President Biden's policy stance.

On the 16th, Vice President Harris also unveiled her "First 100 Days Economic Plan," aimed at winning middle-class votes, which includes tax cuts for ordinary citizens, support for new homebuyers, expansion of housing supply, and regulation of large corporations' food price hikes.

In contrast, Republican presidential candidate former President Trump has announced plans for comprehensive tax cuts. Previously, Trump significantly lowered the corporate tax rate from 35% to 21% during his tenure, and ahead of the November election, he is reportedly considering another corporate tax cut. Although specific rates have not been disclosed, considering his past pledge of 15%, it is expected he may aim to reduce it to that level.

However, any changes to the tax rate must be approved by Congress. Therefore, the outcome will depend heavily not only on the November presidential election but also on which party controls Congress in the simultaneous House and Senate elections. For the Democrats, regaining the Republican-held House majority and maintaining current control of the Senate are necessary to push through Vice President Harris's 28% proposal. Local media have noted that if enacted, the U.S. corporate tax rate would be among the highest in major developed countries. Harris's camp has not yet disclosed specific plans for how the additional revenue from the tax increase would be used.

Meanwhile, despite the reduction in the U.S. base corporate tax rate since 2017, corporate tax revenues have increased due to rising corporate profits. The Business Roundtable, a corporate lobbying group, argues that the corporate tax rate should remain below 21%.