ABI’s federal partners at the U.S. Chamber of Commerce submitted the following call to action to push back on an effort to raise corporate taxes to pay for an array of new federal spending programs. Specifically, ABI members are being asked to contact Senators Charles Grassley and Joni Ernst and Congresswoman Cindy Axne. With narrow majorities in the U.S. House and Senate, each vote is critical. This is not a fire drill - this is critical action that needs to be taken.
A description of the tax issue from the Chamber and how to take action follows:
Congress is currently considering a massive tax increase on business to pay for several major new federal spending programs. Under the proposal, the corporate tax rate would increase to 28 percent from its current 21 percent, increasing taxes by one-third on businesses that are still working to recover from the recession brought on by the COVID-19 pandemic.
Why It Matters to You
Many assume that only big businesses will pay this higher rate. That couldn’t be farther from the truth. In fact, if your business is organized as a C-Corp, you would see your tax bills increase significantly. 18,498 of our state’s businesses are affected and we need your help to fight this corporate tax increase in Washington, DC. These higher taxes would eliminate jobs, in some cases, close stores, and/or cut back on investments in our community.
Moreover, when state and local taxes are included, the total corporate tax rate for Iowa would come to 35.1 percent if the federal rate were increased to 28 percent, according to data from the U.S. Chamber of Commerce. Our businesses are just now returning to normalcy, and a sudden and substantially steep increase in the corporate rate is one sure way to stop the recovery’s momentum dead in its tracks.
Higher rates on businesses in our state would suppress wage growth and job creation at a time when one of the few things we can all agree on is the need to create more higher-paying jobs here at home.
Action You Can Take
Let’s keep the corporate tax rates where they are, so our businesses can continue to prosper and create the growth and jobs our state needs to keep this recovery going. We urge you to join our efforts by asking Congresswoman Axne and Senators Grassley and Ernst to oppose raising the taxes on your business.