Democrats want to increase taxes on the rich and corporations to pay off a $3.5 trillion budget bill

President Joe Biden And Congressional Democrats have long made it clear that they intend to pay for their wish-lists by raising taxes on the rich and big businesses. But lawmakers did not at first give details about what would happen.

The draft proposal, which may still change before it is officially released on Monday, calls for raising the top marginal rate on individuals to 39.6%, up from the 37% rate set by Republicans’ 2017 tax cut law. . Plans aired Sunday and obtained by CNN.

This rate will apply to individuals whose taxable income exceeds $400,000 per year and married couples who jointly earn more than $450,000 annually.

The top capital gains rate will increase from 20% to 25%.

In addition, lawmakers would impose an additional 3% tax on individuals with an adjusted gross income of more than $5 million.

And it would broaden the net investment income tax to cover net income received in the ordinary course of a business or business for single taxpayers, joint filers with more than $400,000 in taxable income, or joint filers with more than $500,000 in income.

Currently, as part of the Affordable Care Act, some high-income Americans are subject to an additional 3.8% Medicare tax on certain investment income and a 0.9% Medicare surcharge on wages.

Overall, the additional charge on high-income individuals would raise about $1 trillion. Biden has promised That those earning less than $400,000 a year would not see a tax increase.

The proposal also calls for raising the top corporate tax rate to 26.5%, up from the current 21% set by Republicans’ 2017 tax cut legislation. This would only apply to businesses with incomes in excess of $5 million.

Biden had called Increase the corporate rate to 28% To pay for its economic reform agenda. Before the 2017 law, the top rate was 35%.

And the House resolution would increase the minimum tax on foreign income of US companies to 16.5 percent from the current 10.5%. Biden had suggested increasing it to 21%.

The plan would also raise taxes on the wealthy and businesses, among other measures, including revising the rules governing cryptocurrency transactions.

It would also give the Internal Revenue Service an additional $80 billion over the next 10 years. tax enforcement of high-income americansMILF K Joe Congressional Budget Office Estimated to raise $200 billion. And it will raise an additional $700 billion from proposal projects Allowing Medicare to negotiate drug prices and a. to end Controversial drug exemption rules Enacted by the Trump Administration.

All told, the measures will raise an estimated $2.9 trillion, although the plan warns that “this number remains very preliminary.” When combined with dynamic revenue growth of an estimated $600 billion projected by the White House, the proposal would completely offset the cost of Democrats’ budget package, according to drafters.

hitting obstacles on the shape

Aware that they will receive no Republican support for a massive expansion of the country’s security system, Democrats plan to pass the package through a reconciliation process that does not require GOP votes in the Senate. .

Thirteen House committees are preparing legislation that will build up to a bigger package in the coming days, with the goal of submitting a detailed bill by Wednesday. Democratic leaders are expected to have a floor vote later this month.

But fighting has already broken out within the Democratic Party. West Virginia Sen. Joe Manchin telling CNN’s Dana Basho on Sunday that he would not support the $3.5 trillion price tag. Kirsten Cinema of Arizona has also indicated that it does not support the price tag, and Sen. Mark Warner of Virginia said in a statement Sunday evening that he believes the spending bill “falls short”. Because there is not enough money for housing assistance.

Munchkin’s comments prompted Sen. Bernie Sanders, who chairs the budget committee that laid out recommendations for the comprehensive plan, telling Bash in a separate interview that it was “not acceptable” that Munchkin would not support the bill.

What the House Democrats Are Proposing

The 10-year spending plan is the latest step in Democrats’ campaign to expand education, health care and child care support, tackle the climate crisis, and make further investments in infrastructure.

Party leaders are hoping to use the annual budget process to push forward several measures in Biden’s jobs and families proposals that have been blocked by the Republican opposition.

The draft legislation, being written by various House committees, calls for establishing a universal Pre-K program for 3- and 4-year-olds and a new child care benefit for working families. will make an offer community college free Increase the maximum Pell Grant award size to two years and for low-income students.
MLAs are also proposing Adding Dental, Vision, and Hearing Benefits to Medicare and creating a federal Medicaid expansion program to cover low-income adults in states that have refused to adopt the Affordable Care Act provision.

It includes a number of provisions to combat climate change and to invest in infrastructure and jobs.

This story has been updated with additional information.

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