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Biden to propose 25 percent minimum tax on US billionaires

The US president’s announced budget plan would also nearly double the capital gains tax on investments.

US President Joe Biden will call on Congress to impose a 25 percent minimum tax on billionaires as part of a series of proposed tax increases for high net worth individuals and companies, according to a US media report.

The spending plan proposed by Biden would also nearly double the capital gains tax on investments from 20 percent to 39.6 percent, and raise income taxes for businesses and wealthy Americans, Bloomberg News reported Wednesday.

Biden will unveil his budget plan on Thursday amid sharp divisions between Republicans and Democrats over taxes, spending and debt reduction, kicking off likely fraught negotiations between the White House and a divided Congress.

The spending plan comes as Republicans and the White House are locked in a deadlock over raising the debt ceiling, the total amount the federal government is allowed to borrow, amid a $31 trillion national debt.

Republicans, led by Speaker of the US House of Representatives Kevin McCarthy, have argued that the ceiling should not be raised without significant spending cuts and have rejected calls for higher taxes.

Biden has said his plan will reduce the deficit by nearly $3 trillion over 10 years, primarily through tax increases. The Republicans have a majority in the House, while the Democrats control the Senate.

During his State of the Union address in February, Biden called on Congress to support higher taxes on the wealthy and “reward work, not just wealth.”

The U.S. president has insisted that his proposed tax increases will only affect a small percentage of Americans, telling an audience in Virginia last week that those with annual salaries under $400,000 “will not pay a penny of extra tax.”

Biden proposed a minimum income tax for billionaires last year to ensure that households worth more than $100 million pay at least 20 percent tax on both income and unrealized gains from unsold investments.