President Joe Biden is proposing a minimum tax on the wealthiest Americans’ incomes and unrealized gains.
Biden unveiled his $5.8 trillion budget for the fiscal year 2023 on Monday, which includes increased defense spending and funds for domestic law enforcement programs.
It also includes a new tax on the wealthiest Americans and an increase in the corporate tax rate.
The new tax would apply to Americans worth at least $100 million and would require them to pay 20% of their income.
The New York Times notes the tax would also apply to their “unrealized gains in the value of their liquid assets, such as stocks and bonds, which can accumulate value for years but are taxed only when they are sold.”
“The ‘Billionaire Minimum Income Tax’ would apply only to the top one-hundredth of 1 percent of American households, and over half of the revenue would come from those worth more than $1 billion,” the Times added.
Those who fall into that category and are paying 20% or more would not see an increase.
Additionally, the Times notes, “The payments of Mr. Biden’s minimum tax would also count toward the tax that billionaires would eventually need to pay on unrealized income from assets that are taxed only when they are sold for a profit.”
A White House fact-sheet argues that the current tax code “offers special treatment for the types of income that wealthy people enjoy.”
The investments laid out in President Biden's budget are more than fully paid for through tax reforms that ensure corporations and the wealthiest Americans pay their fair share. pic.twitter.com/t8ZJyFz9Oh
— The White House (@WhiteHouse) March 28, 2022
Additionally, it stated that “over half the revenue would come from billionaires alone” and that the tax “would ensure that, in any given year, they pay at least 20 percent of their total income in Federal income taxes.”
The White House believes the tax will reduce the deficit by $360 billion over the next decade.
Biden’s budget would also increase the corporate tax rate from 21% to 28%.
“While their profits have soared, their investment in our economy did not: the tax breaks did not trickle down to workers or consumers. Instead of allowing some of the most profitable corporations in the world to avoid paying their fair share,” the White House fact-sheet reads.
It added, “This increase is complemented by other changes to the corporate tax code that incentivize job creation and investment in the United States and ensure that large corporations pay their fair share.”
