‘It will stifle our economy’: Republicans react to Biden’s plan to fund infrastructure package with tax hike

‘I’m not interested in raising taxes across the board on America,’ McConnell says

Top Republicans have begun efforts to push back against tax hikes as a means to fund President Joe Biden’s trillion-dollar infrastructure funding plan, claiming the measures will "stifle the economy”.

Mr Biden is set to unveil his “Build Back Better” package on Wednesday in Pittsburgh and reports have said the package could collectively cost as much as $4trn (£2.9trn) and include $3trn (£2.2trn) in tax increases.

“So the president has an ambitious goal,” White House press secretary Jen Psaki told reporters in a press briefing on Monday.

Bloomberg previously reported that the package of measures could include an increase in both the corporate tax rate and the individual rate for high earners.

In response to reports of the proposals, top GOP operatives have formed a group called The Coalition to Protect American Workers to fight Mr Biden’s tax agenda, Axios reported.

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One of the leaders of the group, Marc Short, former vice president Mike Pence’s ex-chief of staff, told the outlet that tax increases would kill jobs and "stifle our economy as the country is finally emerging from a pandemic".

According to the website, the group could be planning to spend at least $25m (£18.1m) on TV and digital ads and organising to target members of Congress from swing districts who may back the plans.

Senate minority leader Mitch McConnell also hit out at the plans at a recent an event in Kentucky, saying: “If you want to do an infrastructure bill, let’s do an infrastructure bill.”

“Let’s don’t turn it into a massive effort to raise taxes on businesses and individuals,” he said, according to The New York Times.

“I’d love to do an infrastructure bill,” he added. “I’m not interested in raising taxes across the board on America. I think it will send our economy in the wrong direction.”

Negative reactions to the plans were also seen by GOP members earlier this month, with Maine senator Susan Collins reportedly having burst out laughing when asked how Senate Republicans would react to Mr Biden’s tax proposals.

“I would not anticipate that it would be well received,” Ms Collins said, according to The Washington Times.

Bloomberg reported that Kevin Brady, the top Republican on the House Ways and Means Committee, said: “There seems to be a real drive to tax investment of capital gains at marginal income rates.”

He reportedly called the drive a “terrible economic mistake”.

When questioned about how much of the package needs to be paid for with tax revenue, Ms Psaki said that the White House would be “happy to look at proposals” of lawmakers who disagree with possible funding plans.

“If they don’t want to pay for it, I guess they can propose that too. Maybe they don’t support infrastructure spending,” Ms Psaki said.

Additional reporting by the Associated Press