Bezos endorses higher corporate taxes for infrastructure

WASHINGTON (AP) — Amazon founder and Chief Executive Officer Jeff Bezos endorsed United States (US) President Joe Biden’s focus on building up the country’s infrastructure on Tuesday and said the company even supports a corporate tax rate hike to help pay for it.

Bezos’ statement, posted on the company’s website, was notable because it came after Biden singled out the company for criticism about how much it pays in federal taxes when he recently unveiled his USD2.3 trillion infrastructure proposal.

Biden has proposed hiking the US corporate tax rate to 28 per cent from 21 per cent to help pay for his plan, an idea that Republican leaders are panning as harmful to economic growth. Democrats will surely cite support from individual companies to undercut that argument.

“We recognise this investment will require concessions from all sides — both on them specifics of what’s included as well as how it gets paid for (we’re supportive of a rise in the corporate tax rate),” Bezos wrote. “We look forward to Congress and the Administration coming together to find the right, balanced solution that maintains or enhances US competitiveness.”

Bezos was careful not to endorse a specific plan. Rather, he said “we support the Biden Administration’s focus on making bold investments in American infrastructure”.

Cars manoeuvre through tangle of expressways in Jersey City, New Jersey. PHOTO: AP

The company would benefit from the investments made in roads, bridges, airports and broadband. Business groups have joined in the call for more public works investment by the federal government, but they have generally balked at Biden’s call for raising the corporate income tax, with the US Chamber of Commerce describing Biden’s proposal as “dangerously misguided when it comes to how to pay for infrastructure”.

Along with partially undoing the corporate tax cut put in place during former US president Donald Trump’s administration, Biden also wants to set a minimum US tax on overseas corporate income, and to make it harder for companies to shift earnings offshore.

Amazon has long been criticised for paying virtually no federal taxes in the US for years, even as it built an e-commerce empire that currently has a market value of USD1.6 trillion.

That has changed slightly in recent years as the Seattle company has become more profitable. Last year, it reported paying USD1.7 billion in federal taxes on its US income of USD20.2 billion, working out to an effective tax rate of about eight per cent.