CCAGW Joins Coalition Urging Congress to Oppose Efforts to Raise Corporate Tax Rate | Council For Citizens Against Government Waste

CCAGW Joins Coalition Urging Congress to Oppose Efforts to Raise Corporate Tax Rate

Letters to Officials

January 22, 2025

The Honorable Jason Smith, Chairman
The Honorable Richard Neal, Ranking Member
Committee on Ways and Means
US House of Representatives
1129 Longworth House Office Building
Washington, DC 20515

The Honorable Mike Crapo, Chairman
The Honorable Ron Wyden, Ranking Member
Committee on Finance
United States Senate
219 Dirksen Senate Office Building
Washington, DC 20510

Dear Chairman Smith, Ranking Member Neal, Chairman Crapo, Ranking Member Wyden, and Members of the Committee on Ways and Means and the Committee on Finance,

On behalf of the undersigned organizations, which advocate for millions of taxpayers, workers, and consumers across America, we urge you to oppose any efforts to raise the corporate tax rate above the 21% level set in the 2017 Tax Cuts and Jobs Act (TCJA), more commonly known as the Trump tax cuts.

While some critics try to paint the 2017 corporate tax rate reduction as a giveaway to big business, there were bipartisan concerns going back well over a decade that U.S. corporate rates were too high relative to the rest of the world. Studies showed that these high rates were affecting our nation’s economic competitiveness and holding back wages and the availability of jobs for American workers. Even many leading Democratic economists were supportive of lowering the corporate tax rate.

The TCJA brought down the combined corporate tax rate to a level just above the OECD average, and since then much of the developed world has continued to lower its rates. Corporate executives have indicated that the lower rate was an important part of their decisions to increase investment in the U.S. According to a study of corporate tax returns covering years before and after enactment of the TCJA, the U.S. domestic corporate capital stock will grow by over 3.5% over the long run based on the lowered corporate rates alone. Moreover, by the end of the 10-year budget window, dynamic effects of the rate changes will fully offset static revenue losses from the changes. This suggests that further rate cuts could lead to even greater economic benefits.

Americans widely benefited from the lowered corporate tax rate, which increased wages, jobs, and the balances of retirement plans for millions. Increasing the corporate rate from the current level could therefore cost jobs, lower wages, and hurt future retirement prospects. A past study has shown that half of the burden of a corporate rate increase would be borne by workers, primarily those who are low-income, younger, and female. Another showed that wages drop by 49 cents for each dollar increase in corporate taxes. Studies have also shown that a rise in corporate rate led to a reduction in GDP growth, lower potential output, sagging productivity, and higher inflation in the long run. High rates can even lead to an increase in the size of the informal economy, thereby exacerbating tax avoidance. And since any increase would push America’s corporate tax rate above peer Organization for Economic Cooperation and Development (OECD) countries, it would make investing in the U.S. less attractive for international firms, costing American jobs.

We call for members of Congress to oppose any legislative proposals that would increase corporate tax rates. Tax stability is critical to corporate investment and decision-making, which is one reason why the new rates were made permanent in the TCJA. Higher, volatile rates can reduce the ability for businesses to make clear investment decisions, possibly leading to less capital formation, fewer jobs, and lower wages. Indeed, a recent study of OECD countries points to a stabilization in corporate tax rates worldwide. The lower corporate tax rate in the TCJA is working and Congress should not increase it.

Thank you for your consideration, and we stand ready to assist with the passage of critical tax legislation this year. 

Sincerely, 

Brandon Arnold
Executive Vice President, National Taxpayers Union 

James L. Martin
Founder and Chairman, 60 Plus Association 

Brent Gardner 
Chief Government Affairs Officer, Americans for Prosperity 

Stephanie Smith 
President and CEO, Alabama Policy Institute 

Saulius "Saul" Anuzis 
President, American Association of Senior Citizens 

Dick Patten 
President, American Business Defense Council 

Phil Kerpen 
President, American Commitment 

Rick Manning 
President, Americans for Limited Government 

Grover Norquist 
Founder and President, Americans for Tax Reform 

John R. Toedtman 
Executive Director, Caesar Rodney Institute 

Ryan Ellis 
President, Center for a Free Economy 

Daniel Mitchell 
President, Center for Freedom and Prosperity 

Jeff Mazzella 
President, Center for Individual Freedom 

Nathan Benefield 
Chief Policy Officer, Commonwealth Foundation 

James Edwards 
Executive Director, Conservatives for Property Rights 

Gerard Scimeca
Chairman, Consumer Action for a Strong Economy 

Yael Ossowski 
Deputy Director, Consumer Choice Center 

Tom Schatz 
President, Council for Citizens Against Government Waste 

David Bowser
Director of Legislative Affairs, Faith and Freedom Foundation 

George Landrith 
President, Frontiers of Freedom 

Cameron Sholty 
Executive Director, Heartland Impact 

Mario H. Lopez 
President, Hispanic Leadership Fund 

Carrie Lukas 
President, Independent Women's Forum 

Seton Motley 
President, Less Government 

Charles Sauer 
President, Market Institute 

Wendy Damron 
President and CEO, Palmetto Promise Institute 

Jon Decker
Senior Fellow, Parkview Institute 

Daniel J. Erspamer 
CEO, Pelican Institute for Public Policy 

Mike Stenhouse 
CEO, Rhode Island Center for Freedom and Prosperity 

Karen Kerrigan 
President and CEO, Small Business and Entrepreneurship Council 

David Williams 
President, Taxpayers Protection Alliance 

Steve Pociask 
CEO, The American Consumer Institute 

Aiden Buzzetti 
President, The Bull Moose Project 

Bob Carlstrom 
The Carlstrom Group 

James Taylor
President, The Heartland Institute 

Patrick Purtill 
Executive Vice President and General Counsel, Unify.us 

Casey Given 
Executive Director, Young Voices 

Issues Topics: 
Letter Type: 
Coalition Letters