Biden Unveils Budget Plan: Tax Increases on Wealthy and Corporations, Military Pay Raise, and Record Levels of Debt
President Joe Biden unveiled his budget on Thursday, a sweeping blueprint that includes proposals to increase taxes on corporations and wealthy Americans to revive many of the tax policy ideas of the Build Back Better Act.[0] The budget has no chance of getting passed by Congress, but it signals Biden’s commitment to creating a fairer economy and providing a “blue-collar blueprint” for his expected 2024 re-election bid.[1]
The Biden budget proposes higher taxes on the wealthy, including a top tax rate of 39.6% for single filers making more than $400,000 a year and married couples making more than $450,000 per year as well as a 25 percent tax on the nation’s wealthiest 0.01 percent of families.[1] It would also raise the corporate tax rate from 21 percent to 28 percent and quadruple the 1 percent tax on stock buybacks.[2] To help shore up Medicare, the budget proposes a tax increase for people making more than $400,000 a year.[3]
The budget also includes an increase to defense spending, an 8 percent rise in nondefense discretionary spending, and a 5.2% raise for military pay, the largest boost since a 6.9% average military pay increase in 2002.[4] In addition, Biden has proposed a 4 percent tax on stock buybacks and a new Medicare tax on business income to pay for social security and Medicare.[5]
Biden is also calling for a higher tax on stock sales than at any time since the 1970s, a move that would discourage Americans of all income groups from saving and investing.[6] Furthermore, the budget proposes a minimum tax on billionaires and restoring the enhanced child tax credit, which would make the credit fully refundable so more low-income families would qualify.[7]
The White House claims that the budget plan would reduce the federal budget deficit by $3 trillion and extend the solvency of the Medicare Trust Fund by at least 25 years.[8] However, the nonpartisan Committee for a Responsible Federal Budget (CRFB) has concluded that the budget would take the U.S. to record levels of debt, with total federal debt increasing by an astounding $19 trillion over the next decade.[8] The national debt would reach 110 percent of GDP by 2033, and interest payments would total over $1 trillion per year by the time Biden leaves office in 2029.[9] Moreover, the budget does not address Social Security, which is also facing insolvency.[0]
0. “Biden's Budget Aims to Hit Republicans Where It Hurts” The New Republic, 10 Mar. 2023, https://newrepublic.com/article/171079/bidens-budget-doomed-still-matters
1. “Biden Calls for Doubling of Capital Gains Tax Rate” Kiplinger's Personal Finance, 10 Mar. 2023, https://www.kiplinger.com/taxes/biden-calls-for-doubling-capital-gains-tax-rate
2. “Biden’s $5 trillion tax gambit catches Congress by surprise” The Hill, 12 Mar. 2023, https://thehill.com/homenews/administration/3894747-bidens-5-trillion-tax-gambit-catches-congress-by-surprise/
3. “Biden sets up for an election fight with his budget proposal” Al Jazeera English, 9 Mar. 2023, https://www.aljazeera.com/economy/2023/3/9/biden-sets-up-for-an-election-era-fight-with-his-budget-proposal
4. “Troops would see biggest pay raise since 2002 under Biden budget plan” Military Times, 9 Mar. 2023, https://www.militarytimes.com/pay-benefits/2023/03/09/troops-would-see-biggest-pay-raise-since-2002-under-biden-budget-plan
5. “Biden's budget is a declaration of war on American businesses that will hit you hard” Fox News, 11 Mar. 2023, https://www.foxnews.com/opinion/bidens-budget-declaration-war-american-businesses-hit-hard
6. “Biden’s billionaire tax proposal, explained” Vox.com, 10 Mar. 2023, https://www.vox.com/money/23634085/biden-2024-budget-billionaire-tax-capital-gains
7. “What's in Biden's budget” CNN, 9 Mar. 2023, https://www.cnn.com/2023/03/09/politics/2024-budget-joe-biden-explainer/index.html
8. “Biden’s Budget Is Economically Reckless and Socially Clueless” Yahoo News, 12 Mar. 2023, https://news.yahoo.com/biden-budget-economically-reckless-socially-041809531.html
9. “Biden's Budget Binge Overtaxes, Overspends, And Overborrows” The Federalist, 10 Mar. 2023, https://thefederalist.com/2023/03/10/bidens-budget-breakdown-how-the-big-government-binge-overtaxes-overspends-and-overborrows
