The powerful House Ways and Means Committee announced on Monday they’ll discuss plans of the leading Democrats in the US House of Representatives that are seeking to raise the US top tax rate on corporations, Reuters writes.
The planned raise of US top tax rate to 26.5% up from the current 21% is part of the broader, $3.5 trillion domestic investment plan – the so called “reconciliation” bill- of the Democrats and will be debated in the tax-writing panel’s work sessions on tax policy and other matters under its jurisdiction scheduled for Tuesday and Wednesday.
The tax changes are aimed at helping pay for on bill to expand social services for the elderly and children and tackle climate change and according to House Speaker Nancy Pelosi’s plan, it will have a full vote in the Democratic-controlled House as soon as the end of this month.
Democrat’s plans envision setting graduated corporate tax rate of 18% on annual income below $400,000, 21% on income up to $5 million and 26.5% on income above $5 million, but will include a provision to cut the taxes for the smallest businesses in United States.
It will also increase the capital gains tax rate incomes above $400,000 to 25% from the current 20% with an additional 3% surcharge on taxable income in excess of $5 million.
The federal tax rate on corporations that was 35% prior to the 2017 Republican tax restructuring, is currently 21% so Democrats can’t put too much hope on the potential support of the Republicans.