Sinema’s office outlines opposition to tax rate hikes

Sen. Kyrsten Sinema’s office on Friday outlined the senator’s opposition to raising tax rates, saying the Arizona Democrat thinks that just increasing rates “will not in any way address the challenge of tax avoidance or improve economic competitiveness.”

The statement comes as Democrats have been scrambling in recent days to figure out how to pay for their social-spending package given Sinema’s opposition to increasing tax rates on corporations and high-income individuals.

“Senator Sinema has been engaged for months in substantive, nuanced policy negotiations and is well-versed in the range of current tax proposals being considered,” Sinema spokesman John LaBombard said in a statement.

“She is committed to ensuring everyday families can get ahead and that we continue creating jobs,” LaBombard added. “She has told her colleagues and the president that simply raising tax rates will not in any way address the challenge of tax avoidance or improve economic competitiveness.”

President Biden and congressional Democrats are seeking to pass legislation that includes spending and tax cuts in areas such as child care, health care and climate. They have sought to full offset the cost of the spending and tax cuts, largely through tax increase on wealthy individuals and corporations.

Biden and House Democrats both released plans earlier this year to raise the corporate tax rate, the top individual income tax rate and the top capital gains rate. But key politicians in recent days have suggested they may have to abandon these proposals due to resistance from Sinema.

Every Democratic senator will need to vote for the social spending package for it to pass, since the chamber is evenly divided between Democrats and Republicans.

During a CNN town hall Thursday evening, Biden said he didn’t think Democrats had the votes for rate hikes.

“I don’t think we’re going to be able to get the vote,” he said. 

Ideas that Democrats are considering in lieu of tax rate increases include taxing billionaires’ investment gains annually, a tax on stock buybacks and a minimum tax on large corporations’ income as reported on financial statements. 

Sinema’s office said that the senator is working with Sen. Elizabeth Warren (D-Mass.) on tax options. Sinema is known in the Senate as a moderate, while Warren is known as a progressive.

“While Senators Sinema and Warren have at times approached tax policy from different perspectives, they have in the course of these negotiations found common ground around policies to address tax avoidance and make our tax code more effective and efficient,” Sinema spokeswoman Hannah Hurley said. “As she has for months, Senator Sinema will continue to work directly in good faith with the White House, Senate leadership, and her colleagues to expand economic opportunity while growing American economic competitiveness.”

Friday’s statements are the first official comments on taxes from Sinema’s office since news outlets reported this week that Democrats were looking at tax proposals other than rate increases due to the senator’s position. Sinema herself has not made public comments on her position on taxes in recent days. 

Updated at 6 p.m.