House Democrats are proposing almost $3 trillion ($3,000,000,000,000) in tax increases including tax increases on small businesses and working families. This is the largest tax increase since 1968 compared to the size of the economy and the largest tax increase ever in nominal dollars.
Some of these tax increases include:
Raising taxes on working families by increasing the federal corporate income tax rate from 21 percent to 26.5 percent. This tax increase will be passed along to working families in the form of higher prices, fewer jobs, and lower wages. This will give the U.S. a combined state-federal rate of 30.9 percent, higher than our foreign competitors including China, which has a 25 percent corporate tax rate, and Europe which has an average rate of 21.7 percent. The developed world average (OECD) is 23.5%.
Top earners in New York City could face a combined city, state and federal income tax rate of 61.2%, according to plans being proposed by Democrats in the House of Representatives.
The plans being proposed include a 3% surtax on taxpayers earning more than $5 million a year. The plans also call for raising the top marginal income tax rate to 39.6% from the current 37%. The plans preserve the 3.8% net investment income tax, and extend it to certain pass-through companies.
The result is a top marginal federal income tax rate of 46.4%. The marginal rate is the rate for every dollar above the tax bracket income threshold.
In New York City, the combined top marginal state and city tax rate is 14.8%. So New York City taxpayers who earn more than $5 million a year would face a combined city, state and federal marginal rate of 61.2% under the House plan.
The House plan is still a proposal and could change. Yet the combined rates for New York City would be among the highest in nearly 40 years.
Top earning Californians would face a combined marginal rate of 59.7%, while those in New Jersey would face a combined rate of 57.2%. Hawaii could face combined rates of 57.4%.