WASHINGTON – President Joe Biden will propose a tax hike on the investment gains of the wealthiest individuals to pay for his new plan to help United States families, a top White House economist said yesterday.
Biden this week is expected to lay out his US$1.8 trillion (RM7.3 trillion) American Families Plan that will provide national child care, paid family leave and free community college, using higher taxes on the rich to offset the hefty price tag.
White House National Economic Council head Brian Deese said the increased levy on the profits earned from sales of stocks and other assets will impact only those earning US$1 million a year, a narrow sliver of American taxpayers comprising 500,000 people.
“This change will apply to only 3/10% of taxpayers, which is not the top 1%, it’s not even the top one half of 1%,” he told reporters, citing 2018 tax filing data.
Deese said the change will help “offset the long-term cost of those investments by making reforms to our tax code that reward work, not just wealth”.
He did not provide any detail of the new higher tax, but media reports last week cited officials saying the plan will increase the capital gains tax rate to 39.6% from 20%.
“It will be a plan that will provide critical support for children and families, and by doing so, critical support for our economy.”
Biden is due to address a joint session of Congress tomorrow night.
Biden said wealthy individuals will have to “pay their fair share” to fund his policy priorities, and he has not backed down in the face of Congressional or business opposition – a stance recent polls show most Americans support.
His massive US$2 trillion infrastructure and jobs plan will be paid for in part with higher corporate taxes. – AFP, April 27, 2021
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