Tax The Middle Class: Biden Is Battling His Own Party

Written By BlabberBuzz | Tuesday, 21 September 2021 12:00

President Biden is working to prevent congressional Democrats from scaling back his tax proposals, as lawmakers work on a $3.5 trillion social spending package aimed at advancing the president's economic agenda.

The White House and congressional Democrats both seek to raise taxes on the wealthy and corporations, and strengthen tax enforcement, to support investments in areas such as child care, health care and climate.

But the legislation that the House Ways and Means Committee approved Wednesday raised some taxes by less than Biden had previously proposed, and left out some proposals altogether.

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It remains unclear whether the administration can persuade lawmakers to be more aggressive on tax increases and enforcement, given Democrats' narrow majorities in Congress.

In recent days, the White House has stepped up its messaging and lawmaker-outreach efforts around the social-spending package, and in particular has been emphasizing its proposals to raise taxes on high-income households and corporations and to increase IRS enforcement against the wealthy.

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The tax proposals were front and center in a speech Biden gave at the White House on Thursday.

“I’m not out to punish anyone. I’m a capitalist. If you can make a million or a billion dollars, that’s great. God bless you,” Biden stated. “All I’m asking is that you pay your fair share. Pay your fair share just like middle-class folks do. But that isn’t happening now.”

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Biden argued with Republican criticisms of his economic plans, insisting GOP lawmakers would “rather protect the tax breaks of those at the very top than give tax breaks to working families.”

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“It’s about the super-wealthy finally beginning to pay what they owe — what the existing tax code calls for — just like hard-working Americans do all over this country every Tax Day,” Biden said in Thursday’s speech.

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The new efforts come as House panels advance their portions of the $3.5 trillion package. Notably, the Ways and Means Committee advanced a portion that includes tax-increase provisions as well as provisions that extend expansions of tax credits that benefit low- and middle-income households.

The committee’s proposal seems less aggressive in raising taxes on high-income households and corporations than proposals Biden released earlier this year. House Democrats are proposing smaller increases in the corporate tax rate and the top capital gains rate than Biden previously had. Additionally, the committee left out several of Biden’s revenue raising proposals, including those to tax capital gains at death and to increase the amount of information financial institutions report to the IRS about bank accounts.

White House officials have publicly spoken positively about the Ways and Means Committee bill, agreeing it’s a key step toward accomplishing Biden’s goals on taxes. At the same time, the administration is pushing Congress to do more.

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