What is the main implication of a corporate tax rate increase under Biden's tax plan?

The main implication of a corporate tax rate increase under Biden's tax plan is that it is expected to raise significant additional tax revenue. This is rooted in the understanding that increasing corporate tax rates can enhance government income, which can then be allocated toward various public services and initiatives.

A higher corporate tax rate means that corporations will contribute a larger share of their profits to federal revenue, thereby potentially allowing the government to fund infrastructure projects, education, healthcare, and various other programs aimed at benefiting the economy and society as a whole. This approach is aligned with the administration’s goals of investing in public services and addressing budget deficits.

Other options touch on different consequences of a tax rate increase. The increased compliance costs may arise due to more complex tax filings, while small businesses might not feel a significant impact if their income levels place them outside the new corporate tax brackets. Additionally, while higher taxes could deter some investments, the focus of option B highlights the broader goal of enhancing tax revenue, which is the primary intent of the policy change.