Democratic Senators Pressure Biden To Cut Some Taxes For Rich People In Infrastructure Bill

[Shabibilicious]

Infrastructure Week may finally be looming on the horizon.  

 

 

Democratic senators pressure Biden to cut some taxes for rich people in infrastructure bill

 

Hans Nichols

Mon, March 15, 2021, 8:51 PM

 

 

Blue-state lawmakers are pressuring President Biden to cut some taxes — while he raises others — in the horse-trading for his next big package.

Why it matters: The cold math suggests Biden will be forced to sacrifice the size of his infrastructure ambitions or embrace even more deficit spending — and convince Congress to go along.

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Driving the news: Democrats, including Senate Majority Leader Chuck Schumer (D-N.Y.), are pressing the White House to repeal the $10,000 limit for deducting state and local taxes — the so-called SALT cap — from their federal tax bill.

• Removing the limit — imposed by President Trump's 2017 tax reforms — would cost about $88.7 billion a year, according to the Joint Committee on Taxation.

• Repealing the cap is deeply unpopular with progressives, who argue doing so would favor the rich.

• But many voters in high-tax (and Democratic) states — like New York, New Jersey, Connecticut, Maryland and California — hate the limit. The provision is scheduled to expire at the end of 2026.

 

The big picture: The White House has been reluctant to put a price tag on its infrastructure plans, but Democrats close to the administration say it will likely be $1 trillion to $2 trillion.

• Some Democrats, including Sen. Joe Manchin (D-W.Va.), are demanding the president find new revenue to pay for at least part of the package.

• Biden himself has never been crystal clear about what new spending needed to be offset with new taxes, and gave himself an out during the 2020 campaign by maintaining "one-time" spending didn't require tax increases.

• He never defined what that means and essentially stopped talking about it after he secured the nomination.

• He also didn’t include it in any of his “Build Back Better” tax and infrastructure proposal.

Go deeper: During the campaign, Biden proposed policies that would raise about $3 trillion in new revenue, according to the Penn Wharton Budget Model.

• But Democrats close to the White House think new revenue will probably be a total of less than $1 trillion, with the easiest changes on the corporate, capital gains and personal side.

By the numbers: Manchin told Axios he would support the corporate tax rate increasing from 21% to 25%, which could yield $400 billion to $500 billion in new revenue over 10 years.

• Returning the top personal rate to the pre-Trump 39.6% would bring in another $153 billion.

• Taxing capital gains as ordinary income — which would eliminate the so-called “carried interest” loophole for private equity — adds another $178 billion.

The bottom line: The amount of new revenue Biden could raise night not exceed the amount of lost revenue from a full repeal of the SALT cap.

 

https://www.yahoo.com/news/democratic-senators-pressure-biden-cut-005109199.html

 

GO RV, then BV