President Biden Promises To Raise Taxes For Those "Making More Than $400,000 A Year"

President Biden Promises To Raise Taxes For Those "Making More Than $400,000 A Year"

He also added that Americans who make less than $400,000 "won't see one single penny in additional federal tax."

U.S. President Joe Biden on March 15, 2021 in Washington, DC. (Photo by Drew Angerer/Getty Images)

In an interview with ABC News on Tuesday, March 16, 2021, President Joe Biden reiterated that he still intends on raising taxes for the wealthier section of Americans, saying  "anybody making more than $400,000 a year will see a small to significant tax increase." This is the same thing he'd said back in August 2020, per The New York Times. Along with this, he also added that Americans who make less than $400,000 "won't see one single penny in additional federal tax."  



He added, "If you take a look at the corporate tax rate under Trump, if you raise the tax rate back up to what we thought it should be, it was at 35%, they brought it down to 21%. Bring it to 28%. That raises $800 billion. You have now 90 of the Fortune 500 companies don't pay a single penny in federal tax. Not a penny. Making billions of dollars."

One of the first things that Biden did after becoming the President was to roll out his $1.9 trillion Covid-19 relief law which got a lot of flak from Republicans because the tax breaks in his plan go to the bottom 60% of the population while "their idea of a tax cut is to give the Trump tax cut where 83% went to the top 1% of people in America."



With not many Republican takers, Biden remains optimistic with his Democratic votes. Biden added, "If we just took the tax rate back to what it was when (George W.) Bush was president, the top rate paid 39.6% in federal tax, which would raise $230 billion. Yet they're complaining because I'm providing a tax credit for child care? For the poor? For the middle class?"  It is a possibility that some Democrats may not be on board with his tax plan, but he does have the full support of Sen. Joe Manchin (D-WV).



Sen. Manchin is one of the most powerful moderates in the Senate, and he's on board with tax increases to pay for infrastructure and climate bills, reports Vox. "Whatever the president proposes will be just the beginning," said Michael Mundaca, head of Ernst & Young’s national tax department and former assistant secretary for tax policy for the Treasury Department. "There are very strong personalities with deep-seated views on tax policy in general. The tight majorities in the Senate mean everyone has a stronger, louder voice than they otherwise would have in a more normal, less closely divided Congress."



White House press secretary Jen Psaki said that Biden believes that "those at the top are not doing their part" and "obviously that corporations could be paying higher taxes." Treasury Secretary Janet Yellen suggested that the White House would put forward proposals in due course of time to get deficits under control, noting that the tax hike could happen in the near future. "(Biden) hasn't proposed a wealth tax but he has proposed that corporations and wealthy individuals should pay more in order to meet the needs of the economy, the spending we need to do, and over time I expect that we will be putting forth proposals to get deficits under control," Yellen said. She also clarified that "that the $400,000 threshold applies to families, not individuals. Consequently, individuals who make $200,000 could be affected if they are married to someone who earns that same amount, for example."



But, there are obstacles that need to be crossed, because the US economy is still only recovering from the pandemic. "We’re still in the midst of a recession, and it would be pretty easy to make the argument that this isn’t a great time to be talking about tax increases," said Leonard Burman, co-founder of the Tax Policy Center and a Syracuse University economist. "If the economy comes roaring back, then it would be the appropriate time to be talking about tax increases." He added, "But the question is just timing, and it’s always a bad time for a tax increase because it’s hard to get your base excited about raising taxes."  




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