Photo: Kevin Lamarque/Reuters

Seeking to fund the most ambitious economic, social, and infrastructure plans since the New Deal of the 1930s, the Biden Administration is proposing to raise up to $2.5 trillion over 15 years through a rise in corporate tax rates and changes in tax codes.

On Wednesday, the US Treasury released the details of the tax plan. It includes raising the corporate tax rate to 28%, after the Trump Administration slashed it from 35% to 21%.

A new minimum tax will be imposed on global profits of large companies, and preventing them from moving profits offshore. A 15% tax will be imposed on profits reported to investors, targeting companies which earn at least $2 billion per year and have no federal income tax liability.

The Administration estimates 45 corporations will be affected.

President Joe Biden said on Wednesday, “Companies aren’t going to be able to hide their income in places like the Cayman Islands and Bermuda in tax havens.”

At the same, with the need to hold all Democrats in a 50-50 Senate, Biden said he is ready to discuss the proposed 28% corporate tax rate:

We’ve got to pay for this. We’ve got to pay. There’s many other ways we can do it. But I’m willing to negotiate….

Debate is welcome. Compromise is inevitable. Changes are certain….[But] inaction is not an option.

Treasury Secretary Janet Yellen spoke of the global “race to the bottom” of corporate taxation and its effect on the US economy.

“Our tax revenues are already at their lowest level in generations,” she said. “If they continue to drop lower, we will have less money to invest in roads, bridges, broadband, and R&D [research and development].”

Last week Biden unveiled the American Jobs Plan, a “once in a generation investment” of $2 trillion in infrastructure. In late March, the Administration released details of a $3 trillion package for economic revival, reduction of carbon emissions, and promotion of economic equality.

Last month, despite resistance from almost all Republicans, Congress passed the $1.9 trillion American Rescue Plan to deal with the Coronavirus pandemic and its economic effects.