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.
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.
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.
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.
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.
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.