A new report from the nonpartisan Tax Foundation showed that President Joe Biden’s latest tax proposal would kill jobs and shrink the economy.
Biden unveiled a $5.8 trillion budget this week with tax proposals to pay for it. Those tax measures include raising the corporate tax rate from 21% to 28% and taxing unrealized capital gains.
“The actual policies laid out in the budget, however, would reduce economic growth and create unsound fiscal policy, with no real evidence provided to support claims to the contrary,” experts at the Tax Foundations said. “The Biden budget assumes the Build Back Better Act (BBBA) becomes law and is somehow made deficit neutral. Our analysis, like that of the Congressional Budget Office, indicates BBBA as passed by the House is not deficit neutral, but rather would increase deficits by more than $800 billion over the next decade. Furthermore, because the bill proposes several tax increases that raise marginal tax rates on individual and corporate income, we find it would reduce the size of the economy over the long run by 0.5 percent and eliminate 125,000 jobs.”
Republicans on the House Ways and Means Committee have touted this report and blasted Biden’s plan.
From the committee:
[The plan] Kills Nearly 140,000 Jobs: “President Biden’s proposal to hike the corporate tax rate to 28 percent will shrink the U.S. economy and decimate more than 138,000 jobs over the next decade, found an analysis by the nonpartisan Tax Foundation.”
Cuts Wages for Workers Across Income Levels:
- Those making less than $19,500 per year would see their after-tax income drop by $550.
- Those making between $19,500 and $33,100 would see a $1,120 cut.
- Those making between $33,100 and $50,229 would have their post-tax income shrink by more than $2,000.
- Individuals making between $50,229 and $80,150 would see a drop of $3,340.
Overall, experts say the tax plan has big problems.
“Biden’s proposal would take the tax code in the wrong direction by imposing a complicated tax on a narrow segment of high-earning households in a way that’s never been tried, adding new compliance and administrative challenges for an already overburdened IRS while weakening the U.S. economy by raising the tax burden on U.S. saving and entrepreneurship,” the Tax Foundation said.