Several centrist Democrats seeking their party’s 2020 presidential nomination are supporting rates in that former centrist ground. Former vice president Joe Biden and former New York City mayor Mike Bloomberg have both called for a 28% corporate rate, while Democratic Senator Amy Klobuchar backs a 25% rate. Bloomberg is the founder and majority owner of Bloomberg LP, the parent company of Bloomberg News.
The two parties can’t even agree on how to read the data on corporate tax collections since the 21% rate took effect in 2018. Democrats point to data showing that corporate tax receipts have fallen in comparison to gross domestic product.
Percentage of GDP
The Joint Committee on Taxation projects that corporate income collection in 2019 will be about 1.1% of GDP, in line with 2018. The average corporate tax collection as a percentage of GDP for the previous five years was 1.7%, according to the nonpartisan congressional tax scorekeeper.
Republicans say the dollar amount collected rose in 2019 to about $230 billion, up from nearly $205 billion in 2018.
“Corporate taxes aren’t disappearing, they are growing – more than 12% last year,” Representative Kevin Brady, the top Republican on the Ways and Means Committee, said Tuesday. “Corporate revenues are set to rise over the next decade both in real dollars and as a percent of GDP,” he said, citing the Congressional Budget Office.
CBO has said the corporate tax law hasn’t greatly exceeded or fallen short of its projections.
“Our analysis of preliminary data suggests that total payments of that tax will be slightly smaller than we had projected,” Phill Swagel, the CBO director, said in a blog post this month. “Notwithstanding our revisions to the effect on corporate income tax revenues, the effects on the budget have seemed generally consistent with our expectations.”
This story provided by Bloomberg News.