The budget that President Biden released on Monday projects to cut deficits by $3 trillion over a decade, and it does so with an approach that has become familiar: tax increases for companies and the wealthy.
The president previewed several of the proposals in his State of the Union speech last week and contrasted them with those of Republicans, who have called for extending most of the $2 trillion of tax cuts that former President Donald J. Trump signed into law in 2017. For Mr. Biden, tax policy has been at the center of his efforts to make the economy more equitable and to counter Republican tax proposals that Democrats deride as giveaways to the wealthy.
“Does anybody here think the tax code’s fair?” Mr. Biden said during remarks in New Hampshire on Monday. “I don't either.”
transcript
Biden Plan Would Raise Taxes on Corporations and the Wealthy
The proposals in President Biden’s budget plan, including the tax increases, project to reduce deficits by about $3 trillion over a decade.
It’s my goal to cut the federal debt even more by making big corporations and the very wealthy begin to pay their fair share. I’m not anticorporation. I represented the state of Delaware. More corporations incorporated in Delaware than every other state in America combined. Combined. But guess what? But I’m a capitalist, man. Make all the money you want. Just begin to pay your fair share, your taxes. I had a tax code that charged them [billionaires] 25 percent. Not the highest rate — 25 percent. You know how much that would raise over the next 10 years? $400 billion. [$400] billion a year. Imagine what we could do, from cutting the deficit to providing for child care, to providing health care, to continue to provide our military with all they need. So, folks, look, this is not beyond our capacity.
Overall, Mr. Biden is proposing $5 trillion in additional taxes on corporations and high earners over the next decade. Here’s what those increases would entail:
Corporate tax increases
The budget employs a mix of approaches to make American corporations pay more in federal taxes. That includes raising the corporate tax rate to 28 percent from 21 percent, which is the level that was set by the 2017 Tax Cuts and Jobs Act.
Mr. Biden also calls for increasing what’s known as the corporate minimum tax to 21 percent from 15 percent. That tax, which was passed by Democrats in 2022, applies to corporations that report annual income of more than $1 billion to shareholders on their financial statements but use deductions, credits and other preferential tax treatments to reduce their effective tax rates well below the statutory 21 percent. White House economists estimate increasing the tax could yield $137 billion in new tax revenue over a decade.