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Treasury Secretary Yellen proposes higher corporate taxes for businesses

She said higher taxes are needed to fund infrastructure investments

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In a speech delivered online to the U.S. Chamber of Commerce on Tuesday, Treasury Secretary Janet Yellen pushed for corporate leaders to pay higher taxes to support President Joe Biden's multi-trillion dollar infrastructure plan.

The funds, she said, would help reduce worker pay inequality and rebuild the country's infrastructure. She said the country's corporate income tax needs to be raised to 28% from its current rate of 21%. 

“With corporate taxes at a historical low of one percent of GDP, we believe the corporate sector can contribute to this effort by bearing its fair share: we propose simply to return the corporate tax toward historical norms,” Yellen said in prepared remarks for the Chamber’s Global Forum on Economic Recovery.

Improving profitability and welcoming competition

Yellen said President Biden's $2.2 trillion corporate tax hike and infrastructure plans will improve the profitability and competitiveness of American businesses and benefit the American people. 

"We are confident that the investments and tax proposals in the Jobs Plan, taken as a package, will enhance the net profitability of our corporations and improve their global competitiveness. We hope that business leaders will see it this way and support the Jobs Plan," she said.

She then pitched the idea of lowering barriers to global competition in an effort to welcome it. 

“Let others innovate and advance. Let us seek to advance faster and further. We ultimately benefit from the positive spillovers of innovation wherever it occurs,” she said. “As in any competition, if you lose one contest, you work harder to win the next. The better the competition, the stronger you will get. That has been the American way.”

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