WASHINGTON – President Biden is urging Congress to raise taxes on wealthy Americans for the first time in nearly a decade to help pay for family aid in exchange for its ambitious $ 1.8 trillion plan to transform the US economy.
Biden’s American Family Program, which offers billions of dollars in childcare, family vacation and education, will almost double the capital gains tax, reaching 39.6% for more than $ 1 million a year. The current rate is 20%.
The package also calls for raising the upper tax rate to 39.5%, up from the current 37%, which is in effect from the Tax Reform Act introduced by Republicans in Congress in 2017. According to Biden, the tax rate will be restored to the level it was before the tax reform law.
In addition to raising taxes for the rich, the offer also extends to a number of tax credits that the administration says provide needed assistance to low- and middle-income families.
More: Biden “ready to negotiate” size, $ 2.25 trillion tax plan with taxpayers
Biden is expected to present his vision for tax spending during his speech before a joint congressional hearing on Wednesday night, his first since becoming speaker of the legislature.
A senior administration official who outlined the details of the package to reporters on Tuesday said the plan would make sure rich Americans pay their taxes, keep Biden’s campaign promise that no one would earn less than $ 400,000 a year to raise their taxes.
The American Families Plan is the companion to a $ 2.3 trillion package of jobs and jobs called the American Jobs Plan that Biden proposed earlier this month. Biden plans to spend more than $ 4 trillion on the “family program” job package, which he calls a one-generation investment to restructure the US economy.
But getting the offer through Congress could be Biden’s biggest challenge. Democrats in the House փոքր They have a small majority in the Senate, giving them little room for political maneuver, given the plan that is expected against a strong GOP.
If lawmakers have other ideas on how to pay for the package, Biden is “open to hearing them,” said a senior administration official. But, according to the official, Biden believes that people are “fundamentally necessary” in the matter of tax justice – people owed taxes.
If approved, the package would mark the first comprehensive tax increase for Americans since 2013, when then-President Barack Obama allowed previous tax cuts for the rich.
More: “We can not delay.” Biden offers $ 2 trillion in infrastructure, a job program funded by corporate tax increases
The tax proposals that Biden is pushing under his infrastructure և jobs package և his American Family Plan project will eliminate the tax cuts that former President Donald Trump և congressional Republicans enacted in 2017. Biden’s plan.
According to the Infrastructure և Jobs Program, the corporate tax rate will increase from 21% to 28%.
A separate package for the benefit of families will close a number of long-standing gaps that the administration claims are rewarding wealth for work, widening income, and racial disparities of wealth.
For example, current tax laws allow wealthy Americans to avoid capital gains taxes by keeping them until their deaths and then passing them on to their heirs without tax.
Biden’s plan will close that gap by ending the so-called “strengthening” profit base of more than $ 1 million. The change is designed so that family businesses, farms are protected, and do not have to pay taxes to their heirs, a senior administration official said.
More: Democrats press Biden to include expansion of Medicare, prescription drugs in his American Families Plan
Biden also suggests providing the Internal Revenue Service with additional resources and powers over the next 10 years to help tighten tax evasion by wealthy taxpayers, large corporations, businesses and estates. The administration estimates that tax increases will bring in $ 700 billion over the next decade.
In addition to raising taxes for the rich, Biden plans to extend tax credits that benefit low- and middle-income families.
The child tax credit, which was extended as part of the $ 1.9 trillion COVID package approved in March, will be extended until 2025. The COVID bill increased the loan from $ 2,000 to $ 3,000 to $ 3,000 for each 6-year-old և child և $ 3,600 for children under 6 years old. ,
The tax credits that families can use under the Affordable Care Act to reduce their health insurance premiums and temporarily extend the Child Dependent Care Credit, which can be applied to the care of children under 13, will be extended forever at Biden’s suggestion.
Michael Collins covers the White House. Follow him on Twitter: @mcollinsNEWS.
This article originally appeared in the USA TODAY. Biden seeks to raise taxes on the rich to pay for an ambitious “family plan”