How would raising corporate taxes affect the economic recovery?

Raising either the corporate tax rate or the so-called GILTI tax on income from foreign operations would undermine economic growth, just as the U.S. economy is recovering from the pandemic and starting to gain steam. The costs of a corporate tax increase would be high for American companies — and for their workers.

A tax hike would slow employment growth across the country, because companies would have less money to invest in new plants and research and development. Multiple non-partisan analyses have found increasing corporate taxes would reduce U.S. employment, wages, investment and GDP.

Recent history shows just how much everyday Americans benefit from competitive corporate tax rates. Prior to the pandemic, when the lower corporate tax rates went into effect in 2018, U.S. unemployment reached a 50-year low. Just as importantly, median real wages rose in 2018 and 2019 at nearly double their total growth rate over the prior 15 years, with the greatest wage growth occurring for production and other non-management employees.