President Joe Biden's plan for the first major tax hike in nearly 30 years is facing stiff opposition from Republicans who say the proposal is carved from the ideology of wealth redistribution and would seriously stunt any post-COVID economic recovery.
Biden and congressional Democrats intend to push a new major bill that could potentially be aimed at infrastructure, jobs, or climate, the Hill reported. News of the legislation comes on the heels of the passage last week of the $1.9 trillion COVID -19 package that ensured stimulus checks for many Americans and funding for a host of other non-pandemic Democrat priorities.
Rep. Mike Turner, R-Ohio, told Newsmax TV’s 'Spicer & Co.' on Monday that Biden’s coming tax plan is all about Democrats’ social agenda.
"This is not about revenue," Turner said. "This is about their social agenda. You know, when you look at our economy, where we’re just recovering, and we may be coming out of the COVID lockdown, this is not the time to raise taxes. You don’t stimulate the economy then take money from the economy … That’s because this is not about revenue. This is about their philosophy that companies have too much money."
As part of the coming bill, Biden is planning the first major tax hike since 1993, a boost that could include an increase in the corporate tax rate and the individual rate for individuals earning over $400,000 per year.
The changes would likely include the repeal of parts of former President Donald Trump’s 2017 tax cut legislation and could include a 7-point percentage increase in the corporate tax rate, from 21% to 28%, an expansion of the estate tax, and a raise in the capital gains tax for people earning more than $1 million per year.
White House Press Secretary Jen Psaki said Monday that Biden is committed to his campaign pledge to not raise taxes on people making under $400,000 annually. She maintained that Biden's eventual tax plan would focus on ensuring that wealthy people and corporations pay their "fair share."
"That remains his overarching approach, but there isn’t a package yet where we’re talking about pay-fors yet," she said. "I expect we can have more conversations about that down the road."
Rep. Kevin Brady, R-Texas, told CNBC that "in the next package, we’re going to see real serious tax increases on the corporate side, certainly which will drive us to the least competitive tax rate in the world."
The tax increases would "have an impact on the economy, jobs, and wages," Brady said.
The Hill reported that Grover Norquist, the president of Americans for Tax Reform, predicted "there will be no Republican votes for the president’s tax increases."
Norquist said Biden’s campaign tax proposals could end up affecting 401(k) retirement accounts, which could develop into a political problem for Democrats.
"You can’t talk to suburban moms and dads by raising their taxes and raising taxes on the companies they invest in," he said.
Still, some Democrats are holding out hope an infrastructure and jobs bill can attract bipartisan support.
"Building on the popularity of the American Rescue Plan, it is my sincere hope that our Republican colleagues will join us at the negotiating table, so together, we can deliver a package that benefits all our constituents," House Ways and Means Committee Chairman Richard Neal, D-Mass., said in a statement Friday.
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