For those of us who followed the Trump administration closely, the idea of “Infrastructure Week” was a running joke in Washington from February 2017 until the point in 2018 when all sides stopped kidding themselves.

Infrastructure Week would begin with an announcement on a Monday, only to fully come off the rails, or the highway, by Wednesday. The Biden administration is intent on making such massive legislation a reality this time around. What was then scheduled as a week now looks like Infrastructure Year.

On March 31, President Biden announced a sweeping infrastructure package weighing in at $2.3 trillion in new spending over eight years paid for in part with tax increases that will generate revenues over 15 years. Welcome to Washington’s “fuzzy” math. Before we jump into what the Biden administration included in its proposal, we should first remember an important maxim: “the President proposes, Congress disposes.”

The administration’s proposal, titled the “American Jobs Plan,” mentions a variation of the word manufacturing 24 times. Clearly, the industry has the attention at top levels of the U.S. government. Keeping in mind this is simply a proposal from the White House, we find the main areas of focus for manufacturing are job training, R&D and access to capital – all issues on which we know the industry has a keen interest.

The proposal addresses a concern of many manufacturers – recruiting employees and filling that workforce pipeline. The proposal provides funding for targeted workforce development to help reduce barriers to entry for workers and provide employers a broader pool from which to draw new employees. The White House also aims to significantly increase investment in pre-, youth and registered apprenticeship and improve outreach to women and underserved communities.

As a longtime member of the R&D Tax Coalition, I have yet to find another tax provision with such broad bipartisan support. The American Jobs Plan expands incentives for research beyond just green technologies to help American manufacturers take the next leap forward and position themselves for the future. As we saw most recently with the Small Business Paycheck Protection Plan, access to capital remains an issue, and the proposal calls for billions in loans to smaller businesses.

On the other side of the bill, the question of who pays looms large. I began fielding messages from manufacturers right away about when their taxes will increase, how seriously they should take this proposal and, yes, whether they should sell the business and move to Naples, Fla., before the bill becomes law. Rather than list all the provisions related to highways, broadband, health care and worker dislocation, I will focus on the proposed tax increase in this “infrastructure” initiative.

The over $2 trillion proposal is just that right now – a proposal sent to Congress for consideration. The U.S. House of Representatives has begun drafting the legislative text of a bill along the lines of the President’s outline but with their own imprint. A debate has already begun among Democrats about whether the package spends too much or not enough and whether it taxes too much or not enough.

Many of us do expect an increase in the C-Corporate tax rate, lowered to its current levels of 21% from 35% in 2017. Some economists and even those in the business community may tell you the drop to 21% was probably too low at the time, leading many to predict some type of increase. The Biden proposal calls for a 28% rate. While lower than the previous 35% C-Corp rate, several moderate Democrats are calling for a second rate for smaller businesses possibly at 25%. While it is too soon to know a final outcome, we do expect an increase in the C-Corp rate to at least 24-25% that could take effect as soon as Jan. 1, 2022.

In April, as expected, Treasury Secretary Janet Yellen stated the need for a global minimum corporate tax after a recent study revealed that 55 of the country’s largest corporations paid zero in federal income tax on over $40 billion in profit last year, with 26 companies paying no federal income taxes since 2017. Congressional Democrats are making a convincing argument about “paying your fair share,” and the average voter – Republican or Democrat – can agree that companies such as FedEx and Nike paying zero in federal income taxes the past four years is not equitable.

However, smaller and middle-sized manufacturers are likely facing additional scrutiny as part of this “fair share” argument because the majority are not C-Corporations but pay taxes at the individual tax rate. Known as pass-throughs, these entities are structured as an LLC, LLP or S-Corporation, among other classifications. The benefits for a manufacturer of being a pass-through can outweigh the downsides, but the industry has a large, albeit inadvertent, target on its back in the context of tax increases.

Manufacturing is all the rage in Washington right now with lawmakers clamoring to introduce legislation to benefit the industry, from tax incentives and supply-chain reshoring to job training and energy credits. The challenge is that Wall Street hedge funds, law firms and lobbyists are also structured as pass-throughs, and lawmakers will seek to impose a higher rate on those unsavory charters (I have been a registered lobbyist since 2001).

We are hearing from Capitol Hill to expect some type of tax increase on certain pass-through businesses either through the limitation of Section 199a Qualified Business Income or another means but to expect an increase on certain industries that may also affect manufacturers directly or indirectly. We do also know that reverting to previous levels of the Estate Tax is a top priority along with possible changes to Net Operating Loss and Last-in-First-Out (LIFO).

The question of tax increases as of right now is when not if. Democrats are moving toward again using the Budget Reconciliation process, which requires only 50 Senate votes – meaning they can pass a sweeping bill without a single Senate Republican vote as they did with the most recent $2.2 trillion COVID-19 bill. The business community is left with fewer allies in Washington because much of the Republican party has moved away from Chamber of Commerce style politics.

Who will defend manufacturers? Will Congress raise taxes indiscriminately? These are the questions we are facing and the battles we are waging on behalf of manufacturers.

Speaker Nancy Pelosi wants to pass a bill in the U.S. House by July 4 with the Senate gearing to act by Labor Day. This road puts the infrastructure bill on a path to potentially reach President Biden’s desk by the end of the government’s fiscal year on Sept. 30, 2021. While many bumps in the road remain and moderate Democrats are waving the caution flag, we do know manufacturers should buckle up and call their CPA (and lobbyist)