As Tax Day approaches, the millions of people struggling to pay their taxes need to know something. Namely, that President Joe Biden is proposing massive tax hikes in his new budget.
Biden claims he is only raising taxes for giant corporations and the wealthiest people. But in truth, Biden is calling for dozens of tax hikes that would hit our entire economy. He wants an incredible $2.5 trillion in new taxes: nearly $1 trillion for individuals and $1.6 trillion for businesses.
Total federal taxes as a share of the economy would increase to 19.1%, well above the 17.2% average over the last 50 years. Corporate tax receipts would increase 35% above the modern average. His corporate tax rate increase would force U.S. companies to pay a higher tax rate than China’s 25% rate. This would hit 1.4 million small businesses.
Biden also wants to raise individual tax rates, including an 82% increase in the maximum tax on capital gains and dividends. He proposes to tax unrealized gains at death, a tax that would hit the heirs of family farms and family-owned businesses. He is proposing billions of dollars of tax increases on energy producers, despite the need to produce new energy to lower gas prices. His tax increases on private equity and real estate investors would hit pension plans and housing.
Despite all of these tax increases, federal budget deficits would continue to soar, averaging $1.4 trillion a year for the next 10 years.
These Biden tax increases would add another layer of costs to every sector of our economy, leading to higher prices, lower wages, and fewer jobs. They should all be rejected.
Bruce Thompson was a U.S. Senate aide, assistant secretary of Treasury for legislative affairs, and the director of government relations for Merrill Lynch for 22 years.
