Rep. Kevin Brady, the top tax-writing Republican in the House during the Trump administration, suggested Monday that President Joe Biden’s proposals to raise rates on corporations and the rich are nonstarters.
“I’m not sure we should be compromising by making America dramatically less competitive than our global competitors,” Brady said on CNBC’s “Squawk Box.”
The Texas Republican, who is retiring at the end of this term after more than two decades in Congress, predicted “there’s going to be a real fight over these tax increases” and advocated for “a different approach on how we pay for” Biden’s infrastructure plan.
orporations and the rich are nonstarters.
“I’m not sure we should be compromising by making America dramatically less competitive than our global competitors,” Brady said on CNBC’s “Squawk Box.”
The Texas Republican, who is retiring at the end of this term after more than two decades in Congress, predicted “there’s going to be a real fight over these tax increases” and advocated for “a different approach on how we pay for” Biden’s infrastructure plan.
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There’s going to be a big fight over Biden’s tax hike plan, top Republican says
Biden last week laid out the second part of his multitrillion-dollar plan to overhaul the U.S. economy in the wake of the devastating coronavirus pandemic. The packages aim to make huge investments in infrastructure, child care and a slew of other projects that will be paid for in part by hiking the top income tax rate to 39.6% and raising the corporate tax rate to 28%.
Biden’s proposals would reverse some key pieces of the 2017 tax-cut law, which Brady, then the chairman of the House Ways and Means Committee, helped craft. The $1.5 trillion legislation, which cut taxes for corporations and individuals, became a key achievement of former President Donald Trump’s term in office.
Brady said Republicans and Democrats in Congress can “absolutely compromise” on an infrastructure plan, which has “always been a bipartisan issue.”
But “we shouldn’t be funding infrastructure on the backs of American workers,” Brady said.
He proposed that lawmakers should instead start by looking to “recapture” some of the wasted money in the budget and by restoring to their original purpose a number of tax provisions that used to go toward infrastructure but have been subsumed by other issues.
Brady also suggested seeking private capital sources to help raise infrastructure funds.
“There are some different ways we can approach that to drive funding for infrastructure,” Brady said.
But Brady appeared to dismiss the prospect of taxing the rich, arguing that the tax code is already “extremely progressive.”
The Biden administration has called on Republicans to weigh in and offer their own proposals, while stressing that “inaction is not an option.” But Republicans have been quick to slam the plans, and many have accused the White House of employing the rhetoric of unity while governing like partisans. Biden in March signed into law a $1.9 trillion Covid relief bill without any GOP support.
Democrats hold narrow majorities in both chambers of the bitterly polarized Congress. The Senate is effectively split 50-50 between the two parties, giving Vice President Kamala Harris the tie-breaking vote.
The Senate filibuster, which requires a 60-vote threshold for most legislation to be passed, keeps Democrats from pushing most of their agenda through Congress. But budget reconciliation rules allow for some bills — such as the Covid relief bill in March — to be passed with just a simple majority, and Democrats have more opportunities to use that option before the 2022 midterm elections.
Many Democratic lawmakers are pushing for the Senate to end the filibuster — a move that Senate Minority Leader Mitch McConnell, R-Ky., warned would lead to a “100-car pileup” in the chamber. But some moderate Democrats, such as West Virginia Sen. Joe Manchin and Sen. Kyrsten Sinema of Arizona, have also come out against filibuster reform.
Manchin and other moderate Democrats, who in a divided Congress wield outsize influence, have also voiced concern with the trillions of dollars in spending proposed by the Biden administration.
Asked Monday for his prediction on how the fight will play out on Capitol Hill, Brady said, “This is not a done deal by any means.”
“These are dramatic increases in taxes that have real impacts on jobs here in America. There’s no question in my view this is going to sabotage the jobs recovery, it will drive jobs overseas,” he said.
Raising the corporate tax rate alone “makes America nearly dead last competitively and will drive jobs overseas, so I’m not sure we should be compromising by making America dramatically less competitive than our global competitors.”
“I think there’s going to be a real fight over these tax increases and I predict, at some point I’m hopeful there’ll be a middle ground that we find, both on infrastructure and a different approach on how we pay for it,” Brady said.
