Politics 82 unions and liberal groups urge Biden to go bigger on tax hikes and hold the wealthy accountable

18:16  31 march  2021
18:16  31 march  2021 Source:   businessinsider.com

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Joe Biden sitting in a chair talking on the phone: President Joe Biden. White House/Lawrence Jackson © Provided by Business Insider President Joe Biden. White House/Lawrence Jackson
  • 82 liberal groups urged Biden to go bigger on tax hikes and hold the wealthy accountable.
  • They cited Biden's campaign proposals of reversing Trump's tax cuts and investing in IRS enforcement.
  • Despite GOP opposition in Congress, the majority of Republican voters support tax increases.
  • See more stories on Insider's business page.

President Joe Biden is unveiling the first part of his multitrillion-dollar infrastructure proposal today, which could include up to $3.5 trillion in tax hikes. Some unions and progressive organizations are saying he should go even bigger.

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On Tuesday, 81 national organizations, led by Americans for Tax Fairness, sent a letter to Biden and Vice President Kamala Harris, commending the administration's efforts to raise taxes on the wealthiest Americans and encouraging the president to go further. The letter said Biden's tax plans were the "boldest of any major party presidential nominee in modern American history."

The tax proposals have "received widespread media coverage and, perhaps more significant, your boldly progressive tax plan was heavily attacked by your political opponents, who spent untold millions of dollars and claimed falsely that the middle-class would pay more," the letter said. "Yet, you won the most votes ever of any US presidential candidate, with a central promise of your campaign to make the rich and corporations pay their fair share of taxes. You have a clear mandate to pursue your agenda."

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The letter, which was signed by AFL-CIO and MoveOn, said that even among Republicans, raising taxes is popular. For example, a New York Times survey from November found that two-thirds of respondents, including 45% of Republican voters, supported tax increases on people making over $400,000, and an Americans for Tax Fairness survey from October found that 71% of Americans supported raising the income tax rate, including 51% of Republicans.

The best way to hold the wealthy accountable, according to the letter, is to reverse the "worst aspects" of former President Donald Trump's Tax Cuts and Jobs Act (TCJA), including Biden's proposals to:

  • Lift the corporate tax rate to 28% from the current 21%;
  • Restore the estate tax to its 2009 levels, meaning that still only the richest 0.59% of estates would get taxed;
  • And return the top marginal tax rate on the highest incomes to 39.6%, from the current 37%.

Aside from the TCJA proposed changes, Biden also proposed additional tax reforms during his campaign, like investing in Internal Revenue Service enforcement of high-income taxpayers and imposing a "financial-risk fee" on large Wall Street banks.

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The letter said that even along with Biden's campaign proposals, he could implement many other reforms, including a 10-percentage-point surtax on all incomes about $2 million, a financial transaction tax on bond and stock trades, and a wealth tax on ultra-millionaires.

Biden's tax hikes have already faced opposition in Congress. While moderate Democratic Sen. Joe Manchin said an infrastructure proposal could be as large as $4 trillion using tax hikes as funding, Senate Minority Leader Mitch McConnell warned that won't win his party's support.

"I don't think there's going to be any enthusiasm on our side for a tax increase," McConnell told reporters last week. Republicans even recently introduced a bill to repeal the estate tax, which would only affect 0.6% of farm estates.

But progressive lawmakers are continuing to push for measures that hold the ultra-rich accountable. Although Politico reported on Tuesday that Biden will not use a wealth tax to fund infrastructure, Sen. Elizabeth Warren of Massachusetts has led the effort to propose a 2% tax on households with net worths over $50 million.

"A wealth tax is critical for raising revenue, and that revenue is critical for raising opportunity," Warren said on Twitter on March 1. "We build a future for all of our kids by investing in opportunity. This is one way we can make this government work for everyone - not just the rich and powerful."

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65% of voters support corporate tax hikes to pay for Biden's infrastructure plan, new poll finds .
A Morning Consult poll found separate from infrastructure, 85% of Democratic and 59% of Republican voters agree corporations should pay higher taxes. While Biden proposed raising the corporate tax rate to 28%, he expressed willingness to negotiate with the GOP on its size. See more stories on Insider's business page. The $2.3 trillion infrastructure plan President Joe Biden unveiled last week includes a proposed corporate tax hike to 28%, and voters seem to like it, even a significant minority of Republicans.

usr: 0
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