President Joe Biden's administration is considering hiking the US corporate tax rate, Treasury Secretary Janet Yellen said on Tuesday, as it looks to pay for priorities like a forthcoming infrastructure plan.
"We've had a global race to the bottom in corporate taxation and we hope to put an end to that," Yellen told the House Financial Services Committee, adding that Washington wanted to increase the rate to 28 percent.
Biden is expected to soon propose a massive infrastructure package aimed at helping the world's largest economy create jobs and fight climate change as it bounces back from the Covid-19 pandemic.
However, unlike the $1.9 trillion American Rescue Plan Biden signed earlier this month that is intended to help businesses and consumers survive the downturn, the president is under pressure in Congress to offset the costs of the infrastructure package.
"I think a package that consists of investments in people, investments in infrastructure, will help to create good jobs in the American economy and changes in the tax structure will help to pay for those programs," Yellen said.
US media reported on Monday that Biden is considering spending $3 trillion on infrastructure in the United States, which would be split into two bills, although the White House disputed those reports.
Any new measures could face tough odds in Congress, where Democrats hold a thin margin in the House and are evenly split with Republicans in the Senate.