Raising Corporate Tax Rates: A Global Trend?
Not Just a Tunisian Specialty
You may think that increasing tax rates is a Tunisian peculiarity, but you're wrong. It's a tool used by all governments, including that of the most liberal economy in the world, the United States. Vice President and presidential candidate Kamala Harris wants to raise the corporate tax rate from 21% to 28%. This is her first major proposal to increase revenue and fund the costly projects she plans to implement when she occupies the Oval Office.
A Shift in Fiscal Policy
As she gradually unveils her program, it becomes clear that her projects will require enormous expenditures to be covered by revenue sources other than debt. She plans to tackle projects such as expanding the child tax credit, alleviating the cost of housing and medical debt. However, she has learned from her failed presidential campaign in 2020, when she called for the complete repeal of Donald Trump's tax cuts, which would have raised the corporate tax rate to 35%.
A More Responsible Fiscal Policy
The philosophy behind this decision is to make taxation more responsible, allowing workers to keep more of their hard-earned money and ensuring that billionaires and large corporations pay their fair share. The economic stability and security of the middle class, a key electoral demographic, are being targeted. To understand the impact, consider that a single percentage point increase in corporate tax revenue would generate no less than $100 billion.
A Democratic Majority Required
For this to become a reality, Democrats must control the House of Representatives and the Senate. Trump, and Republicans behind him, have recently declared that they would reduce taxes further if re-elected, including for corporations.
A Global Impact
Both decisions would have a significant impact on large corporations, which may either leave or strengthen their presence in the United States. The stakes are high for the world's leading economy. An increase in corporate tax rates would encourage other major countries to adopt the same principle, further tightening the fiscal screws. Wait and see.
