Business Roundtable supports good jobs for American workers, a strong investment environment and sustained economic growth. To ensure competitiveness in the global economy, the United States should maintain the pro-growth tax policies achieved with the 2017 tax law, including the new 21 percent federal corporate tax rate. Increasing the corporate tax rate or imposing other harmful tax increases on businesses would put American jobs and economic prosperity in jeopardy.
The new tax code is designed to strengthen the U.S. economy over the long term, and American workers are already directly benefitting. During 2018, wages increased at 3.3 percent – the fastest rate since 2008 – and private employment grew by 2.6 million jobs. Business investment has been revitalized, with U.S. companies bringing back four times more overseas earnings in 2018 than the prior year. S&P 500 companies increased capital expenditures and R&D investments at double digit rates in 2018 for an estimated total of more than $1 trillion.
After decades of an outdated tax system that disadvantaged American workers and businesses, the United States is now primed to compete. The current combined (federal and state) U.S. corporate tax rate of 25.8 percent is particularly important in an environment where other advanced economies continue to lower their tax rates to attract business investment and the jobs it creates. In 2000, the average combined corporate tax rate of other developed countries was 31.9 percent. Today, the average rate is 23.6 percent – more than two percentage points below the U.S. average – and it will decline further in coming years with rate reductions already enacted. Thus, raising the corporate rate would put at risk job and wage growth for American workers, as well as business investment in the United States.
Business Roundtable agrees that progress in other policy areas needs to be made to maximize America’s economic potential. America needs a significant and sustained investment in infrastructure, new education and training opportunities for workers, and a renewed commitment to innovation to position all Americans for success. We remain committed to working with policymakers on this agenda, focused on complementing rather than counteracting the benefits of pro-growth tax reform.
Increases in the corporate tax rate or any other harmful business tax proposals would undermine the strong economic gains America has achieved and the long-term strength of the American economy.