Biden Seeks 20% Minimum Tax On Households At Least $100M
President Joe Biden intends to propose a minimum tax of 20% on households worth more than $100 million and cut projected budget deficits by more than $1 trillion over the next decade, according to a fact sheet released Saturday by the White House budget office.
Photo Insert: The proposal aims to show that Democrats can deliver on what Republicans have promised before without much success: Faster growth and falling deficits.
The introduction of the minimum tax on the wealthiest Americans would represent a significant reorienting of the tax code. It would apply to the top 0.01% of households with half of the expected revenue coming from households worth $1 billion or more.
The minimum tax would effectively prevent the wealthiest sliver of America from paying lower rates than families who think of themselves as middle class while helping to generate revenues to fuel Biden’s domestic ambitions and keep the deficit in check relative to the US economy, Josh Boak reported for the Associated Press (AP.)
In his proposal expected Monday, the lower deficits also reflect the economy’s resurgence as the US emerges from the pandemic. It’s a sign that the government’s balance sheet will improve after a historic burst of spending to combat the coronavirus.
The fading of the pandemic and the growth has enabled the deficit to fall from $3.1 trillion in fiscal 2020 to $2.8 trillion last year and a projected $1.4 trillion this year. That deficit spending paid off in the form of the economy expanding at a 5.7% pace last year, the strongest growth since 1984. But inflation at a 40-year high also accompanied those robust gains as high prices have weighed on Biden’s popularity.
For the Biden administration, the proposal for the budget year that begins Oct. 1 shows that the burst of spending helped to fuel growth and put government finances in a more stable place for years to come as a result.
One White House official, insisting on anonymity because the budget has yet to be released, said the proposal shows that Democrats can deliver on what Republicans have promised before without much success: Faster growth and falling deficits.