Five Democrats and a handful more Republicans have decided against using corporate or individual income tax increases to pay for spending on infrastructure projects, Bloomberg News reported on Wednesday.
"There are no tax increases. That is a red line for us," Republican senator Mitt Romney said and noted that the key to determining whether the bipartisan group can produce an offer to Biden this week would be whether "there is sufficient support from other Republican senators for our proposal or not."
The move came after Biden ended talks with a group of Senate Republicans led by Senator Shelley Moore Capito after weeks of intense negotiations.
"Despite the progress we made in our negotiations, the president continued to respond with offers that included tax increases as his pay for, instead of several practical options that would have not been harmful to individuals, families, and small businesses," Capito said.
Biden had originally proposed raising the corporate income tax rate from 21 percent to 28 percent to help pay for his US$2.3-trillion infrastructure plan, which was opposed by Republicans and the business community. Later, he lowered the overall price tag to US$1.7 trillion, while Senate Republicans offered a US$928-billion counteroffer.
Over two dozen business groups have also formed a coalition to oppose Biden's plan to raise taxes, arguing that his policy will hamper the U.S. economy in the wake of the COVID-19 pandemic.