Interest groups prepare for battle

President Joe Biden speaks to reporters while visiting the James Cancer Hospital and Solove Research Institute in Columbus, Ohio, on March 23, 2021.

Leah Millis | Reuters

Advocacy groups across the political spectrum are preparing for all-out war over President Joe Biden’s upcoming tax reform proposal, which is expected to include tax increases for the wealthiest families and corporations as part of his infrastructure plan. massive.

It is shaping up to be the “Super Bowl of tax reform,” according to one person who plans to join the fight. This person, who refused to be identified to be able to speak freely, expects a “prolonged battle”.

These are some of the groups that will be involved in the fight, according to interviews with their leaders and representatives:

  • Americans for Prosperity, which is part of the Koch network
  • Americans for Tax Reform, a Conservative Group
  • Our Revolution, a progressive group that grew out of Senator Bernie Sanders’ campaign in 2016
  • Americans for Fiscal Equity
  • Progressive Change Campaign Committee
  • Patriotic Millionaires, a liberal group that aims to raise taxes on the rich

Biden has said since his campaign that he wants to raise taxes on those who earn more than $ 400,000 a year and that he wants to raise the corporate tax rate to 28% from 21%. The president also wants to tax long-term capital gains at the same rate as wages for households making more than $ 1 million a year.

Multiple reports indicate that Biden is considering using those tax increases to pay at least partially for the infrastructure package, which is expected to cost more than $ 2 trillion.

Conservative and libertarian-leaning groups made passing former President Donald Trump’s tax plan a top priority early in that administration. All Senate Republican lawmakers voted in favor of the 2017 bill, with the exception of the then-Senator. John McCain, R-Arizona, who was absent due to his fight with cancer.

Now those groups, including the one backed by billionaire Charles Koch, are preparing to campaign against Biden’s tax reform proposal.

The right plan

The Koch network, through its political advocacy arm of Americans for Prosperity, has included maintaining Trump’s tax cuts as part of its agenda under the new administration and Congress. Democrats also control the House and Senate, albeit by narrow margins.

The group warns that a tax hike will hit a recovering economy that was hit hard by the coronavirus pandemic.

“The Tax Cuts and Jobs Act was a great victory for the American people and helped them keep more of what they earn to put toward their families, businesses and communities,” AFP President Tim Phillips told CNBC. “Taking back those cuts or adding new taxes would worsen our already devastated economy, hurt workers’ wages, crush small businesses, and ultimately come nowhere near paying for the partisan wish lists proposed by President Biden and the leaders. congressional”.

Trump’s tax cuts lowered the corporate rate from 35% to 21%.

A person familiar with the matter said AFP has already engaged in tax and other economic policies with lawmakers’ offices on both sides of the aisle. This person did not specify which offices.

One of the group’s digital ads simply asks for “no tax increase.”

Americans for Tax Reform, which was founded by tax advocate Grover Norquist, has for years rejected any attempt to raise taxes. The group was a fierce advocate for Trump’s tax cuts, and is already promoting through its website some of the ways it aims to attack Biden’s plan.

Norquist, the group’s chairman, told CNBC that Americans for Tax Reform plans to use national and regional opinion pieces to try to convince voters that Biden’s tax plan would end up impacting his 401 (k) s, utility bills. public and other articles.

He hopes that approach will pressure moderate Democrats to oppose or water down the tax proposals. Democrats have a slim majority in the Senate, due to Vice President Kamala Harris’ tiebreaker vote.

“Our plans are a whole court press to make it the most expensive vote,” Norquist said. “He wants it to be so politically expensive for people to reduce the size and scope of the legislation.”

The campaign, he added, will continue “in the hope that it will do so with such success that they say we will not do it until next year, not this year.”

Norquist suggested that Senators Catherine Cortez Masto, Democrat of Nevada, and Mark Kelly, Democrat of Arizona, who are running for re-election in 2022, might feel pressured by their group’s effort. Representatives for Cortez Masto and Kelly did not respond to requests for comment.

Sen. Joe Manchin, DW.Va., who is not running for reelection next year, said he supports a large-scale infrastructure measure that he says should include raising the corporate tax rate to around 25%.

How the left will play it

Across the aisle, progressive organizations see an opportunity to complete one of their top priorities: raising taxes on the rich. The struggles of working and middle class families during the pandemic show that it is time to pass a comprehensive tax reform aimed at the wealthy, they argue.

Democratic lawmakers and liberal organizations pushing for higher taxes for businesses and the wealthy often cite opinion polls that show many voters agree with them.

A 2020 Reuters / Ipsos poll said 64% strongly or somewhat agreed that “the very rich should contribute an additional portion of their total wealth each year to support public programs.”

Our Revolution, a progressive organization led by Sanders, is planning a widespread popular effort to persuade lawmakers from both parties to support raising taxes on the wealthy. Sanders, who calls himself a democratic socialist, for years has been asking the rich to pay more in taxes. The Vermont senator, along with Democrats, including Massachusetts Senator Elizabeth Warren, recently proposed a total annual tax of 3% on wealth that exceeds $ 1 billion.

Paco Fabián, campaigns director for Our Revolution, said the teams will do phone banking as part of this effort.

“Corporations and the rich must pay their fair share. We have seen an incredible amount of profit from the pandemic while people have been losing their jobs and their health care,” Fabian said describing the message the group will convey to lawmakers. during the outreach campaign. .

The Progressive Change Campaign Committee, which has aligned itself with Warren, said it will be active behind the scenes on the issue.

“For the Build Back Better debate, we will do things like conduct polls, communicate behind the scenes with Democratic lawmakers, and make sure our national membership and the general public are fully galvanized,” said Adam Green, co-founder of the group, referring to the name that Biden has given his infrastructure plan.

He said the organization plans to be in contact with the White House and members of the House and Senate.

Green said his group wants the White House to focus on raising taxes on the richest Americans, but avoid a gas tax.

“The best way for the White House to be bold and keep the peace on earth on the fiscal front is for them to focus on progressive taxes, that is, on the rich and corporations, and not on regressive policies like an income tax. gasoline, “he said.


Source link