Economists: 5 Massive Biden Tax Hikes Will ‘Crush’ the Economy

via newsmax

Among the Biden tax proposals that have alarmed conservatives:

  • Biden wants to increase the corporate tax rate from 21% to 28%. This 33% increase would raise $1.3 trillion over a decade. One problem with this approach is companies tend to pass along this added cost by reducing employees’ wages, meaning lower income workers would take a hit. Trump’s tax reforms dropped the rate from the highest in the developed world, at 35%, to 21%.
  • Higher corporate taxes incentivizes corporations to staff their cash overseas, instead of bringing it back to fuel the domestic economy as has been happening under President Donald Trump. Biden proposes a new tax to eliminate that incentive, to capture as much corporate tax as possible. Businesses would face an alternative minimum tax of 15% on their total worldwide revenues, minus a credit for taxes paid to other countries.
  •  He proposes hiking the top capital gains tax rate from the current 23.8% to 39.6%. Economists worry that would make investments less profitable, and could reduce the amount of capital available to fund new business endeavors.
  • Biden wants to increase the top income tax bracket from 37% to 39.6%, but that top rate wouldn’t kick in on income over $510,000.
  • He would restore the individual mandate in the Affordable Care Act, which the Supreme Court has ruled was a de facto tax. The tax is imposed if a citizens declines to obtain health insurance, as a way to strong-arm them into doing so.

Overall, the Tax Policy Analysis found that the top 1% would underwrite 74% of that $4 trillion over 10 years. But because businesses have to shift their burdens to shareholders and workers, those at the lower end of the economic spectrum would not be left unscathed.

 

 

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