Joe Biden Unveils Plan To Reverse Donald Trump's Tax Cuts For Rich

Lawrence Kim
April 28, 2021

The White House's ambitious plans for more than $4 trillion in new spending on infrastructure, health care, and education will be completely paid for by new taxes on corporations and wealthy investors, President Joe Biden will announce Wednesday, Axios reported.

President Biden will make his first speech to a joint session of Congress on Wednesday night, where he is expected to lay out the next steps in his plans to rebuild the economy - which his administration insists can be paid for by taxing the wealthiest Americans.

In addition to free preschool, the American Families Plan would extend an expanded child tax credit through 2025, giving parents monthly payments of at least $250 per child. The package would be funded by raising taxes on the country's wealthiest 1 percent, with the top income tax and capital gains tax brackets both rising to 39.6 percent, nearly doubling the capital gains rate on those making more than $1 million per year.

The Tax Foundation noted that this would increase the capital gains rate for affected individuals to the highest rate in decades. Including the net investment tax on income, the federal rate would rise to 43.4% - and higher for individuals depending on their state tax rates.

Currently, short-term capital gains are taxed at the same rates as income, but long-term gains are taxed at lower rates.

The loophole would be eliminated for gains in excess of $1 million. Biden will also call for more funding for historically Black colleges and universities and other specialty educational institutions, the sources said.

"The president will be proposing a set of measures to make sure the wealthiest Americans pay the taxes that they owe, while also ensuring that no one making less than $400,000 a year will see their taxes go up", one official, who asked not to be identified, told reporters.

Republican leaders have said they are unwilling to undo the 2017 tax law, their signature achievement of the Trump presidency, to pay for what they view as big spending by Democrats.

The new details are part of Biden's $1 trillion-plus package focused on so-called human infrastructure - child care, health care, education and other core aspects of the household architecture that underpin everyday life for countless Americans.

A group of leading centrist and progressive Democrats met late Tuesday with the White House to discuss its priority of making permanent the Child Tax Credit, which was increased to as much as $300 a month as part of a COVID-19 relief package.

Other reports by Click Lancashire

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