Politics

Biden, promising corporate tax increases, cut taxes overall

President Biden, ramping up his populist rhetoric during his re-election campaign, has repeatedly said he would do so. raise taxes on the rich and corporations to make them pay their “fair share”.

Republicans say Mr. Biden has “an unquenchable thirst to tax the American people.” His Republican election opponent, former President Donald J. Trump, said recently that Mr. Biden was “going to give you the biggest, biggest, ugliest tax hike in the history of our country.”

So it might come as a surprise that in just over three years in office, Mr. Biden has cut taxes overall.

The calculation is simple. An analysis prepared for The New York Times by the Urban-Brookings Tax Policy Center, a Washington think tank that studies tax issues, shows that the tax cuts Mr. Biden signed for individuals And companies are bigger than the tax increases he imposed on big corporations and their shareholders.

The analysis estimates that the tax changes introduced by Mr. Biden will represent a net reduction of about $600 billion over four years and slightly more over a full decade.

“It is reasonable to conclude from these numbers that Biden’s tax policy has not been some kind of radical tax-raising program,” said Benjamin R. Pageprincipal investigator at the center and author of the analysis.

The analysis focuses only on tax changes made during Mr. Biden’s presidency, including some direct benefits to individuals and businesses that flow from the tax code. It does not measure the effects of inflation or certain regulations, which Republicans sometimes refer to as “tax hikes” because they can increase costs for businesses and individuals.

It also does not measure the social or economic benefits of Mr. Biden’s spending policies or his regulatory efforts to help consumers, such as cracking down on “junk fees” and limiting the cost of insulin and drugs. other medications.

Instead, the analysis provides a comprehensive look at what Mr. Biden has done to the tax code and how those policies add up.

It is clear from this measure that his record does not match his own ambitions to tax the rich and big businesses – nor the Republicans’ attempts to caricature him as a tax-and-spend liberal.

This is largely because Mr. Biden has struggled to pass his most ambitious tax increase plans. “That’s what can be gotten through Congress and signed into law,” Mr. Page said. “They were prone to compromise.”

A White House spokesman, Michael Kikukawa, said in an email that Mr. Biden was “proud of having cut taxes on the middle class and working families while cracking down on wealthy tax evaders and forcing big companies to pay more of their fair share.”

The tax cuts passed by the president include incentives for companies to manufacture and install solar panels, wind turbines and other technologies intended to reduce fossil fuel emissions, which are a centerpiece of the climate law that he signed in 2022. This law also included tax cuts for people who purchase certain low-emission technologies, like electric vehicles and heat pumps.

Mr. Biden gave tax breaks to semiconductor factories Additionally, as part of a bipartisan advanced manufacturing bill he signed earlier that year.

The president also provided temporary tax relief for individuals and certain businesses. in his Economic Recovery Bill 2021, the American Rescue Plan. The legislation expanded the tax credit for parents. It provided $1,400 direct checks to low- and middle-income Americans, which were technically advance payments on tax credits.

Mr. Biden has partly offset all his tax cuts with two large new levies. Companies are now required to pay tax when they buy back their own shares. Another tax requires large businesses to pay a minimum federal income tax of 15 percent, even though they qualify for deductions that would have allowed them to owe less.

The president also allocated tens of billions of dollars to the Internal Revenue Service to help crack down on high earners and businesses that don’t pay the taxes they owe — an effort that will increase tax revenue federal but will not increase tax rates.

But the president has struggled to convince Congress – including a sufficient number of Democratsin the two years his party controlled the House and Senate under his leadership – only to sign a series of other proposed tax increases.

Mr. Biden’s budget requests are full of ideas for taxing high earners and corporations. They failed to gain ground on Capitol Hill. His most recent budget includes about $5 trillion in tax increases spread over a decade, including long-standing Democratic plans like raising the corporate tax rate from 21% to 28%. .

Republicans have attacked Mr. Biden for his tax plans that they say would cripple the economy. Representative Jodey C. Arrington, Republican of Texas and chairman of the Budget Committee, said in a hearing Thursday that Mr. Biden believes in “more government, more spending and more taxes as the answers to the problems facing our country is facing.”

Mr. Biden has emphasized his tax proposals in recent weeks, including during his State of the Union address. The president has repeatedly said he will not raise taxes on people earning less than $400,000 a year, while calling on millionaires and billionaires to pay more.

He also touted his fiscal record, as he did this week in Las Vegas. “In 2020, 55 of the largest Fortune 500 companies made $40 billion in profits,” Mr. Biden said. “They paid no federal taxes. No more.”

Mr. Biden was referring to the corporate minimum tax created by the Inflation Reduction Act, the 2022 law that also provided for climate-related tax incentives. The Treasury Department has had difficulty implementing this taxthat businesses faced for the first time last year.

The ministry does not yet have data on how many businesses will pay the tax for 2023, officials said this week.

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