Infrastructure Funding Update
This week, President Biden and a bipartisan group of lawmakers discussed alternative ways to pay for infrastructure spending, including a smaller increase in the corporate tax rate, as Republicans and Democrats aired possible changes to the size and scope of the package. The President’s proposal would raise the corporate tax rate to 28% from 21%, along with increasing taxes on U.S. companies’ foreign earnings, to cover the cost of the infrastructure $2.3 trillion price tag. The President and the group discussed a more modest tax increase. Rep. Crist said the discussion included a potential for some “compromise wiggle room” on raising the corporate rate to help pay for the plan. “You could see a 2 or 3% increase—maybe not all the way to 28 but 25.” The President stated “I am prepared to compromise, prepared to see what we can do and what we can get together on. It’s a big package, but there are a lot of needs.” Sen. Blunt (R-MO), a senior appropriator and member of McConnell’s leadership team, said last Friday an infrastructure package of about $600 billion to $700 billion “could be acceptable” to Republicans in a bipartisan measure so long as it does not stray from traditional items like roads and bridges. Sen. Blunt (R-MO) said he’s talking to Senate Democrats and the administration about his recommendation that an infrastructure package be funded with a combination of ideas that include bolstering the Highway Trust Fund, which is now based on a gasoline tax, and levying higher fees related to airports, ports, and railroads. He said public-private partnerships also could provide an added source of financing for projects.