President Biden’s $4.7 Trillion Tax Hike
Plus, a supersized tax collector
Washington, D.C.--After two years of policies that have led to record-high inflation and excessive deficit spending, the Administration is doubling down with more of the same ‘cutting room floor’ tax-and-spend proposals that fail to deliver what Americans want or need, and have been rejected by both political parties.
“The President’s budget calls for nearly $5 trillion in new and increased taxes,” said Senate Finance Committee Ranking Member Crapo. “If realized, these plans would create a tax regime that would lead to some individuals handing over more than half of their paychecks to the government, and many American businesses doing better off being headquartered overseas. Not surprisingly, the budget also requests even more ‘spend first, plan later’ funding for the IRS for enforcement and compliance operations, which will further squeeze hardworking Americans while doing nothing to make the IRS more service-oriented and taxpayer-focused. In his State of the Union address, President Biden repeatedly said, ‘let’s finish the job.’ This budget shows hardworking taxpayers exactly what they can expect.”
Main Street Job Creators Hit with $1.8 Trillion in New Taxes
- Expands the Small Business Surtax to hit owner-operated small businesses with a $650 billion tax hike.
- An additional $235 billion in taxes for non-corporate businesses through an increase in the top individual tax rate.
- Nearly one million small businesses organized as “C” corporations will face a tax rate that is 33 percent higher.
The Highest Personal Income Tax Rate Since 1986
- When combined with surtaxes, the President’s budget calls for hiking the individual federal income tax rate up to its highest level since 1986, nearly 45 percent.
- In addition to raising the rate, the proposal also lowers tax brackets by hundreds of thousands of dollars, thereby pushing tax increases downward on even more hardworking Americans.
An Expanded Death Tax Will Break Up Family-Owned Businesses
- Biden’s $77 billion in death tax increases will force family farms, ranches, and other generational businesses to sell off assets to pay an enormous tax bill to Washington.
- In addition, Biden has revived his plan for a second death tax by forcing heirs to pay an additional tax on their predecessors’ paper gains (including on the inflation that the President’s spending policies will likely stoke).
A Business Tax Regime that Gives China the Upper Hand
- Despite negotiating a 15 percent global minimum tax rate for the rest of the world, the President’s budget calls for leapfrogging the global minimum tax rate for domestic businesses to 21 percent, giving our biggest foreign competitors—like China—the upper hand to undercut America’s ability to fairly compete.
- The budget also calls for hiking the domestic corporate tax rate to 28 percent. When combined with state and local taxes, many companies would face an income tax rate far higher than that. By comparison, China’s (25 percent) and Europe’s (average 21.7 percent) much lower corporate tax rates help insulate their businesses and force American businesses to compete on unfair terms.
A Supersized IRS to Help Collect
- The budget requests an astounding $43.2 billion more for the IRS, in addition to the $80 billion the IRS already received from the Inflation Reduction Act. Of the $43.2 billion:
- $14.1 billion comes from the annual budget request for FY2024.
- An additional $29.1 billion comes in the form of supplemental funding for enforcement and operations.
- Congress’s nonpartisan scorekeepers have already confirmed the IRS cannot collect estimated revenues without auditing those making less than $400,000 per year. Legislative proposals to prevent those individuals from increased audit rates have been rejected by Democrats.
A Continued War on American Energy
- American energy producers (and consumers) are struck with a new $37 billion tax hike, which will cut jobs, raise prices at the pump, and increase our reliance on foreign oil.
- Biden has drained hundreds of millions of barrels of oil from our strategic reserve, leaving us with the smallest reserves since 1983.
A Tax on Savings and Investment
- Quadrupling the brand-new stock buyback excise tax, needlessly harming Americans who save, invest, or participate in retirement plans.
- Taxing stock buybacks artificially hampers business decisions about how best to use funds. It ends up harming Americans who have their life savings invested in 401(k)s, IRAs and the stock market.
- Even Warren Buffet has pushed back on those attacking stock buybacks, saying they are “either an economic illiterate or a silver-tongued demagogue.
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See also: FAST FACTS on the Taxes in FY2024 Biden Budget
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