In his budget proposal unveiled for the election year, President Joe Biden proposes tax increases on wealthy firms totaling $5.5 trillion, including a minimum 25% tax rate for billionaires.
The White House claims that Biden’s $7.3 trillion budget for fiscal year 2025 will also cut the federal deficit by about $3 trillion. The most recent budget would restrict profit-sharing for corporations.
Brian Riedl, a senior scholar at the Manhattan Institute who studies taxation and budgetary issues, claims that the new budget would lead to “the highest sustained taxes” in American history.
“The highest sustained taxes in American history, as well as the largest peacetime burden.”
“The president is not only increasing taxes, but he is allocating a significant amount of those increases to new expenditures instead of reducing the deficit. This just implies that when the time comes to reduce the deficit, there will be even larger tax rises,” Riedl stated.
This follows Biden’s announcement in his State of the Union Address of the latest budget proposals, which included boosting the corporate income tax rate to 28% and the corporate minimum tax rate from 15% to 21%.
It’s true that America is home to 1,000 billionaires. Do you know how much these billionaires typically pay in federal taxes? With a sarcastic tone, Biden stated, “They are making huge sacrifices: 8.2%,” and added that his tax rise would “raise $500 billion over the next 10 years.”
“Nobody making less than $400,000 a year will pay an extra dime in federal taxes under my plan,” he said. Nobody. Not a single dime. And they still haven’t.
Reidl countered that the 8% tax rate was “basically cooked up by White House economists” and that it had been “widely refuted” by the White House.
Riedl said that in addition to expanding their income to include unrealized capital gains that will be subject to taxation in a later year, they “do not consider the corporate and estate taxes paid by the rich.”
“Billionaires do not pay an 8% tax rate, and America has the most progressive tax policy in the whole [Organization for Economic Co-operation and Development].”
But with Republicans in charge of the House and Democrats in control of the Senate, budget demands seldom become legislation, and Biden’s should be no different.
Prior to Biden’s State of the Union address, Jodey Arrington, the chairman of the House Budget Committee (R-Texas), unveiled a budget resolution that aims to build a $45 billion budget surplus and cut deficits by $14.2 trillion.
House Speaker Mike Johnson (R-La.) released a statement about the idea, saying, “At a time when the state of our country is in steep decline, President Biden has proved he is reluctant to make the necessary decisions to tackle the reality of our nation’s imbalanced budget and faltering economy.”
“The American people now face higher daily prices as a result of this administration’s irresponsible spending, the economic harm it has caused, and years of Democratic leadership.”
Comments are closed.