Biden Administration’s Tax Blade Sharpened for the Wealthy
Presentation of the 2024 Budget Draft
According to Iran Gate, President Biden of the United States presented his budget draft on Thursday, March 9th. Biden proposed a minimum 25% tax for billionaires and doubling the capital gains tax.
Capital gains tax is a type of tax applied to profits from the transfer of non-productive assets and is commonly known as the wealthy tax. In reality, this tax applies to individuals who gain profit from selling their investments and properties.
The measures included in the 2024 budget predict increasing the capital gains tax from 20% to 39.6%. Joe Biden will propose to Congress to approve a minimum 25% tax for billionaires. This news was shared by White House sources with Bloomberg News a few hours after the 2024 financial budget was presented.
All of these are considered within an ambitious plan to reduce the federal budget deficit. Besides doubling the capital gains tax from 20% to 39.6%, the President’s plan also includes raising taxes on large corporations and wealthy Americans.
Proposed Budget Awaiting Vote
According to Bloomberg’s article, these budget proposals are essentially a continuation of the multi-billion dollar package known as the Build Back Better Plan. However, they don’t have much chance of getting the green light from Congress, especially now that Republicans hold the majority in the House of Representatives. But they are aligned with the campaign goals for the 2024 elections.
Joe Biden was unable to get the House of Representatives and Senate to approve his desired financial restrictions even when Democrats controlled both chambers, and ultimately had to settle for laws focused on energy and health policies, now known as the Inflation Reduction Act.
Government officials argue that these proposals demonstrate a commitment to reducing the budget deficit by $3 trillion, thanks to increased revenue over the next decade, and signify a return to pre-Trump tax reform levels.
Minimum 25% Tax and Doubling of Capital Gains Tax
The debate on taxing wealthy corporations and economic giants has long been a banner for progressives, and polls show strong support from American voters for this idea and theory.
Kevin McCarthy, Speaker of the U.S. House of Representatives, immediately rejected Joe Biden’s plans to raise taxes and told reporters on Wednesday, ‘I don’t think raising taxes is the right solution.’
What Joe Biden envisions is for 0.01% of America’s ultra-wealthy to pay a minimum tax rate of 25%. They will also increase the maximum tax rate for Americans earning $400,000 a year from 37% to 39.6%, reversing the tax cuts made during the Trump era.
For investors, it is anticipated that those earning at least $1 million annually from long-term investments will pay a 39.6% tax rate instead of the current 20%. This proposal will increase the corporate tax rate from 21% to 28% and reverse another tax change signed by Donald Trump.
Goal to Reduce Budget Deficit
The increase in taxes for American millionaires is expected to help reduce the U.S. budget deficit by $3 trillion over ten years. In the 2024 maneuver, $6 billion is allocated to support Ukraine, bringing the total U.S. expenditure in Kyiv since the Russian invasion to over $80 billion.
Additionally, increased defense spending is anticipated, a section reviewed not only due to Vladimir Putin’s war but also because of ongoing threats from Beijing. Regarding China, Biden has proposed allocating $10 million for a program to monitor American investments in the country. The goal is to prevent American companies from contributing to the growth and development of Beijing’s military industries and to avoid aiding in the development of sophisticated technologies capable of competing with the United States.