Outrage as Trump quietly mulls fresh 'tax windfall' for corporations
The Trump administration’s quiet effort to deliver billions more in tax breaks to some of the largest companies in the United States drew fresh scrutiny and outrage this week, with Democratic members of Congress warning that a series of obscure regulatory changes could further undermine efforts to rein in corporate tax dodging.
In a letter to the US Treasury Department unveiled Thursday, Sen. Elizabeth Warren (D-MA) and Rep. Don Beyer (D-VA) led a group of lawmakers in denouncing the Trump administration’s assault on the corporate alternative minimum tax (CAMT), a Biden-era measure that requires highly profitable US corporations to pay a tax of at least 15% on their book profits—the numbers reported to shareholders“The Trump administration has consistently chipped away at CAMT to further corporate interests,” the lawmakers wrote, pointing to rules issued in recent months exempting many corporations from the tax.
“But these massive giveaways apparently aren’t enough for billionaire corporations and their lobbyists, which are trying to further undermine CAMT,” the lawmakers continued.
The Democratic lawmakers, who were joined by Sen. Bernie Sanders (I-VT), specifically warned against an ongoing corporate push for a carveout to a research and experimentation (R&E) tax break included in the Trump-GOP budget law enacted over the summer.
Corporations supported the R&E tax break. But as the Wall Street Journal reported last month, the giveaway is driving some companies’ “regular taxes down so far that they are pushed into CAMT.”
“This is exactly what CAMT was designed to do, the tax’s defenders say,” the Journal noted. “Companies are pressing the Treasury Department for relief, particularly on the way that CAMT limits the deduction for research expenses. The National Association of Manufacturers, the R&D Coalition, and the National Foreign Trade Council sent letters urging the administration to write rules that would be favorable to companies.”
The Treasury Department and Internal Revenue Service are reportedly considering the corporate proposal.
Such a change, Democratic lawmakers warned in their new letter, “egregiously circumvents Congress’ intent to set a floor on corporations’ tax liabilities regardless of deductions.”
But the Trump administration’s hostility to the CAMT, cozy relationship with powerful corporations, and willingness to trample existing law have fueled concerns that it will readily bow to industry demands.
“Apparently the Trump administration thinks the trillions they spent on tax cuts for the wealthy wasn’t enough now they’re planning another huge tax windfall for the biggest corporations in the country,” Beyer said Thursday.
In a social media post, Warren wrote that “giant corporations are lobbying Donald Trump for yet another tax handout—this time for research they’ve ALREADY DONE.”
“Give me a break,” Warren added. “The last thing American families need is a tax code rigged even more for billionaires and billionaire corporations.”