The Monthly Budget Review of September 2021, issued by the US Congressional Budget Office (CBO), showed a major increase in corporate tax revenues in the year 2021.
Preliminarily, corporate tax revenues in 2021 increased to USD 370 billion from USD 212 billion in 2020. This 74.8% growth rate resulted in part from higher corporate profits earned in 2021.
2021's tax collection is also approximately 24.5% higher than the USD 297 billion collected in 2017. This is significant because 2017 was the year prior to the enactment of the corporate tax rate reductions under President Trump's Tax Cut and Jobs Act (TCJA). In analysing the corporate tax revenues as a percentage of the US gross domestic product (GDP) metric in 2017, it equated to 1.5%, versus today's GDP percentage of 1.63% (based on the estimated GDP of USD 22.74 trillion, provided by the US Bureau of Economic Analysis (BEA)).
This new data will spur more debate in the days to come as the United States grapples with whether to increase corporate tax rates to raise revenues to finance President Joe Biden's Infrastructure Investment and Jobs Act. Under the American Jobs Plan, corporate tax rates would increase to 28%.
Note 1: The CBO is a non-partisan agency that provides objective analyses of budgetary and economic issues in supporting the Congressional budget process.
Note 2: The BEA, which is an agency of the US Department of Commerce, produces economic statistical reports that enable the government, business decision-makers, researchers and the public to understand the performance of the US economy.