Democratic presidential candidate Joe Biden has released a package of fiscal proposals that would raise about $3.4 trillion in new tax revenues — significantly less than the plans of his more liberal rivals.
The Biden package contrasts with Sen. Elizabeth Warren’s proposed $30 trillion to pay for her spending plans. Another progressive candidate, Sen. Bernie Sanders, has said his health care plan alone will cost $30 trillion.
The former vice-president would, among other things, end the preferential treatment of investment income for those making more than $1 million a year — taxing capital gains at the same rate as wage income — and raise the corporate tax rate to 28% from 21%. His plan omits the kind of wealth tax that both Warren and Sanders support.
Biden’s proposals “are certainly more modest than those of other leading contenders for the Democratic nomination,” Politico reported.
But some commentators said his plan indicates how far left the Democratic Party has moved on fiscal policy since the Obama administration.
“It’s so liberal — in very good ways — that when [Biden] was vice-president it would have been considered radical, certainly too much for Barack Obama to have signed into law, or in some cases even suggested,” Paul Waldman, a progressive columnist, wrote in The Washington Post.
He noted that Obama suggested equalizing taxes on wage and investment income but “without any illusions” that it would become law.
Biden would use the tax revenues to fund new spending on higher education, infrastructure, health care and carbon emissions reduction. The proposed hikes are more than double what Hillary Clinton called for during the 2016 presidential campaign.
Under the plan, the tax rate on capital gains would increase from 23.8% to 39.6% for those earning at least $1 million — which would also be top income tax rate, up from the current 37%. Biden would also cap the amount of deductions the wealthy can take,
On the business side, companies would have to pay a minimum tax of 15% to prevent them from using loopholes to avoid paying any tax.
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