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Democratic Presidential nominee Joe Biden said in a CNN interview that aired yesterday (September 10), "I'd make the changes on the corporate taxes on day one. And the reason I'd make the changes on corporate taxes, it can raise $1.3 trillion, if they just start paying at 28%, instead of 21%." Biden dismissed the prospect of waiting until unemployment figures and the economy improve, saying companies are spending money on stock buybacks, not new hires. "They bought back over $1 trillion of their own stock, raising the price of the stock," he said. "That's it, not hiring anybody else, not expanding the business, not investing in new enterprises."

Biden has proposed tax increases to pay for a variety of policy priorities, and while exactly how the 'day one' intention would play out is unclear, it suggests action early in his first term if he wins the presidency and Democrats take control of the Senate, and it will likely require utilizing the budget reconciliation process because the party will almost certainly not hold 60 Senate votes. "The idea that we take that money and put it into new investments in manufacturing, in education, in health care, I mean, these are things that matter to middle-class families," he said.

Biden repeated that "no one making under $400,000 a year will pay a single increase in taxes" and said he had a list of tax changes to make sure that "everybody pays their fair share." He described his proposed 10% surtax on a US company's overseas production profits from sales back to the US and 10% 'Made in America' Tax Credit:

• "[I]f you're going to offshore jobs with federal contracts, offshore jobs, you're going to get a 10% penalty for those jobs you send overseas, because what happens? You send it overseas, because there's a supplier that makes the product cheaper. You bring it back. You get a benefit, a tax break for it. And where does it go? It doesn't go to the employees, by the way, even when it occurs. It goes into the pockets of the CEOs and/or to buy back their stock, to raise the value of their stock."
• "If you invest in America, you refurbish a plant, you build a new plant here, we will provide you a 10% advance on the cost of doing that, encourage people to come back and build here in America."

During a news conference yesterday, President Trump said regarding the coronavirus pandemic, "If we follow Joe Biden's strategy, we'd shut down the entire country after just having set records on growth" and "The approach to the virus is a very unscientific blanket lockdown by the Democrats."

The President held a rally in Michigan and the Wall Street Journal reported him as saying, "Joe Biden surrendered our jobs to China and now he wants to surrender our country to the violent left-wing mob."

President Trump later referenced his executive action on payroll tax deferral, tweeting, "When we win I, as your President, will totally forgive ALL deferred payroll taxes with money from the General Fund. I will ALWAYS protect Seniors and your Social Security! Sleepy Joe Biden will do the opposite, he will raise your taxes and DESTROY our Country!"

Coronavirus relief

Prospects for near-term action on additional coronavirus relief/stimulus legislation remain uncertain. The Senate yesterday failed to advance a targeted Republican bill providing economic stimulus and relief. The vote was 52-47 (60 were required for passage): all the chamber's Democrats and Independents in attendance voted against cloture; all Republicans voted in favor except for Rand Paul (R-KY); and Senator Kamala Harris (D-CA), campaigning in Florida as the Democratic vice presidential nominee, didn't vote. Senate Majority Leader Mitch McConnell (R-KY) advocated debate on a bill that includes necessary relief, while Senate Minority Leader Chuck Schumer (D-NY) continued to balk at the omission of housing and food assistance and state and local funding.

House Speaker Nancy Pelosi (D-CA) continued to face resistance from her ranks over intransigence that threatens to send members home to campaign empty-handed in terms of further relief, and told members on a call, "We don't want to go home without a bill, but don't be a cheap date," and, "When you are in a negotiation, the last place to get weak knees is at the end," Politico reported. Senator Schumer said of Republicans, "We have to wait for them to come to us, if they don't come to us — we will not get something your caucus can support," and House Majority Leader Steny Hoyer (D-MD) raised the idea of passing another coronavirus relief bill in the House. Budget Committee Chairman John Yarmuth (R-KY) is among members who want to pursue a smaller bill to counter perceptions that Congress "can't come together when people are suffering and they can't come together on a reasonable package."

Some suspect that frustration will compel a deal after the House returns from the August recess next week. "When Speaker [Nancy] Pelosi's troops get back into town next Monday, we'll see if there's a frustration among enough of her troops and marginal districts to get us back to the negotiating table," said Sen. Roger Wicker (R-MS) in the Wall Street Journal.

Others aren't so sure. Senator Marco Rubio (R-FL) tweeted yesterday, "Congress isn't going to pass more #Covid_19 relief before the election[.] And the biggest reason why is Speaker Pelosi & Senator Schumer believe Trump & the GOP will be blamed for the pain doing nothing will cause & that will help them win the White House & Senate in November[.]"

Today at 12:00 p.m. is the House Ways & Means Select Revenue Measures Subcommittee hearing, "Consequences of Inaction on COVID Tax Legislation." Witnesses:

• Betsey Stevenson PhD., Professor of Economics and Public Policy, University of Michigan
• Marc H. Morial, President, National Urban League
• Tom Colicchio, Chef and Owner, Crafted Hospitality
• Nakitta Long, Winston-Salem, North Carolina
• Alex Brill, Resident Fellow, American Enterprise Institute

Colicchio brings some star power to the hearing, as he is also the head judge on the Bravo show "Top Chef." Brill served on the Ways & Means Republican staff under former Chairman Bill Thomas (R-CA).

Also today at 12:00 p.m. is the EY Webcast, "Tax in the time of COVID-19." The coronavirus (COVID-19) and the resulting economic crisis have made reacting to tax and trade developments more complicated and more difficult. To determine what information your company needs to know now, join our panelists for a series of conversations about operating the tax function in this time of National Emergency created by the COVID-19 virus. Register.

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