Before Thursday’s release of President Joe Biden’s budget, the White House repeatedly signaled that the president would propose to increase taxes on the rich while trashing the tax cuts signed into law by his predecessor, President Donald Trump, as “irresponsible” and “reckless.”
Karine Jean-Pierre, White House press secretary, told reporters Wednesday that the president’s budget will cut the federal deficit by almost $3 trillion over the next ten years. While the administration declined to go into specifics, President Biden is set to deliver an address about his budget tomorrow.
However, Jean-Pierre did confirm that the budget would propose “tax reforms to ensure the wealthy and large corporations pay their fair share while cutting wasteful spending on special interests like Big Oil and Big Pharma.”
The White House previously discussed reforms that would quadruple the tax on corporate stock buybacks; however, the Biden administration insists it won’t result in more taxes for people making less than $400,000. A different proposal that is reportedly in the president’s budget is a new 20% minimum tax on individuals worth more than $100 million.
Jean-Pierre also pummeled Republicans for vowing to repeal the Inflation Reduction Act, which the White House claims will cut the deficit by over $200 billion.
“The last administration added $3 trillion or $2 trillion to the debt when they put forward a really irresponsible piece of legislation that gave tax breaks to the wealthy, especially millionaires and billionaires,” said Jean-Pierre. “That is something that we have to deal with, and we really have to call out.”
President Biden has called for repeal of Trump tax cuts
President Biden has frequently called for a repeal of the Tax Cut and Jobs Act which President Donald Biden signed into law in 2017. Trump’s tax law slashed rates for businesses and individuals and raised the family tax credits and standard deduction, along with cutting corporate taxes to 21% while at the same time decreasing the Affordable Care Act’s individual mandate penalty to $0.
Republicans claim the tax cut was needed to spark economic growth, while Dems have assailed the law as a giveaway to the rich that would add an estimated $2.289 trillion to the massive deficit.
The president also wants to increase taxes to raise the funding for Medicare. In an op-ed in the New York Times published Tuesday, the president proposed increasing the Medicare tax rate from 3.8% to 5% on incomes exceeding $400,000 per year, including capital gains and salaries. Medicare is projected to drain its Hospital Insurance trust fund reserves by 2028.
President Biden claims his proposal would keep the Medicare trust fund financially sound beyond 2050 without cuts in benefits.
The budget will be released Thursday in Philadelphia. Any proposed tax increases will receive an unfavorable reception from GOP lawmakers, who are in control of the House of Representatives, essentially making the budget dead on arrival.