Biden plans to raise taxes on top earners to 39.6% and capital gains to 43.4%: shares fall as president launches ANOTHER attack on the rich
- Biden will call to reverse part of Trump cut and restore top rate of 39.6%
- Capital gains would rise from the current 20% for high earners
- Profits would also be taxed at 39.6% for those making more than $ 1 million
- Funds to pay for comprehensive child discount, pre-K, and employment proposals
- The Dow dropped 275 points on the news on Thursday afternoon
President Joe Biden is calling for the highest income tax rate to be returned to where it was before Trump’s tax cuts and nearly doubling capital gains for top earners to fund his second phase of his’ human infrastructure ‘plan.’
The monetization steps would be used to pay for education, labor programs, universal pre-K and continuation of a comprehensive children’s tax credit – all proposals Biden plans to set out in a speech to Congress next week.
The president would push the highest income tax rate to 39.6 percent – where it was before Trump’s 2017 tax cuts. Capital gains – where Biden has already called for changes to break a major loophole. would raise rates from their current 20 percent for those making more than $ 1 million.
President Joe Biden will call to raise the income tax rate to 39.6 percent
The increase would cause those owners to also tax their capital gains at a rate of 39.6.
With an existing waiver on investment income, some earners could pay a rate of 43.4 percent, Bloomberg News reported.
Biden is preparing to reveal more details of his proposed $ 4 trillion economic plan, which includes his $ 2.3 trillion infrastructure proposal.
The Dow Jones Industrial Average fell 275 points on the news Thursday afternoon
The Dow Jones Industrial Average fell 275 points on the news Thursday afternoon, or 0.7%.
The broader S&P 500 and the tech-heavy Nasdaq have erased gains to trade at session lows.
His second wave ‘human infrastructure’ plan would use the revenues for an expanded child tax credit that was included on a temporary basis in the $ 1.9 trillion coronavirus plan. Other proposals would include universal kindergarten, paid time off, free tuition, and other programs designed to benefit the workforce, the New York Times reported Thursday.
The highest income tax rate of 39.6% would return to the 2012 level set after President Barack Obama signed the American Taxpayer Protection Act. A net investment income tax of 3.8 percent was included as a revenue enhancer in the Affordable Care Act, bringing the highest total rate to 43.4 percent. The tax hit the investment income of individuals who earned more than $ 200,000 in investment income.
Biden’s spending plan is expected to be around $ 1.5 trillion, on top of the $ 2.3 trillion infrastructure proposal.
Biden campaigned for rising capital gains and voted against a temporary cut to 15 percent during the George W. Bush administration.
He told Iowa Pubic Television in 2019, “I think in fact we should have the capital gains tax that should be the highest minimum tax, we should increase the tax back to 39.6 percent instead of 20 percent.”