Democratic U.S. senators on Tuesday unveiled details of a plan to enact a 15% minimum corporate tax that is expected to apply to about 200 corporations.
The plan was put forward by Senator Elizabeth Warren and Senate Finance Committee Chairman Ron Wyden, both Democrats, alongside Senator Angus King, an independent who caucuses with the Democrats.
The proposal targets businesses with more than $1 billion in profits annually over a three-year period, according to legislative language posted to Warren’s website. Details of the plan were first reported by CNBC.
Lawmakers say the plan would boost tax revenues to help fund policies in President Joe Biden’s Build Back Better package. Democrats, split between the party’s moderate and left-leaning wings, have spent weeks negotiating the size of a deal.
Moderate Democratic Senator Kyrsten Sinema, who had opposed raising the corporate tax rate, said the proposal represented a “common sense” step toward ensuring that highly profitable companies pay what she called a “reasonable minimum corporate tax” on their profits.
Democrats had shifted their plans on taxation in the face of Sinema’s opposition to raising the corporate tax rate and the top personal income tax rate to pay for the hefty spending plan which is a pillar of Biden’s domestic agenda.
The 15% corporate minimum tax would apply to about 200 companies that report over $1 billion in profits annually over a three-year period. King said the plan would raise $400 billion in revenue over 10 years.