United States President Joe Biden speaks during a meeting at the Eisenhower Executive Office Building Library in Washington, DC, the United States, on Wednesday, September 15, 2021.
Oliver Contraras | Bloomberg | Getty Images
WASHINGTON – After a tough summer, President Joe Biden prepares to spend the fall fighting for tax hikes for the rich and corporate.
The rise in the Covid-19 Delta variant, the US withdrawal from Afghanistan, hurricanes, forest fires, evictions and inflation have all hit Biden’s approval ratings and exhausted White House staff.
Now he is turning his attention back to the adoption of a one-time expansion of the social safety net and an infrastructure package.
Biden spoke at the White House on Thursday about why Congress needs to raise taxes on the richest Americans and corporations to fund its Build Back Better agenda.
“The data is absolutely clear,” he said. “Over the past 40 years the rich have gotten richer and too many companies have lost their sense of responsibility towards their workers, their communities and the country.”
Biden pointed to the ratio of CEO salary to average employee wages, which has increased more than 15-fold over the past five decades.
And in a year when millions of Americans struggled to pay their rent and bring groceries to the table while historic unemployment was high, Biden said the combined net worth of the world’s richest people was an estimated 1.8 trillion US dollar has risen.
“How is it possible that the richest billionaires in the country can completely evade income tax on their income?” said Biden. “How is it possible that millionaires and billionaires pay a lower tax rate than teachers, firefighters or law enforcement officers?”
Progress in the house
The President’s speech comes just a day after the House Ways and Means Tax Committee voted to bring forward the tax portion of the Social Security Network bill.
The plan increases the highest corporate tax rate by 5.5 percentage points and the highest individual tax rate by 2.6 percentage points. If enacted as written, the new federal corporate tax rate is 26.5% and the new top tier income tax bracket is 39.6%.
The proposal also provides a 3% surcharge on individual income over $ 5 million and a capital gains tax of 25%.
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In addition to the tax changes, the Ways and Means Bill provides $ 80 billion in addition to funding the Internal Revenue Service, money that Democrats say will improve tax enforcement and help the government collect hundreds of billions of dollars in evaded taxes over a decade .
Biden stressed the need for this funding on Thursday.
“Today, for example, in this country, the top 1% evade an estimated $ 160 billion in taxes they owe each year,” he said. “Not new taxes, taxes they owe.”
“It’s not a fair playing field. My plan would help resolve that. For example, it would give the IRS the resources it needs to keep up with the lawyers and accountants of the super-rich.”
Biden also described a more controversial provision that was not included in the Ways and Means bill.
After the Ways and Means committee submits the tax parts of the bill, they will go ahead to the House Budgets Committee, which will review them along with the other parts of the final bill that have been passed by various committees.
The Ways and Means Committee vote was the first step in a sprint towards a September 27 deadline that House Democrats would have to vote on the $ 1 trillion infrastructure bill and the safety net bill of $ 3.5 trillion.
Over the next 11 days, both House and Senate Democrats will have to write, review, and whip the biggest changes to federal benefits since Obamacare passed in 2010.
At the center of this mammoth effort will be Biden himself, both as the leader of his party and as an experienced negotiator in Congress.
Any doubts about how much the president wants to be at the core of the legislative struggle was dispelled on Wednesday when Biden held separate private meetings at the White House with the Senate’s two most centrist Democrats, Arizona Sen. Krysten Sinema and West. hosted Virginia Senator Joe Manchin.
Both Manchin and Sinema have expressed skepticism about the scope and scope of the bill on the social safety net. In particular, Sinema has questioned the size of the bill and Manchin has raised concerns about some of the tax increases.
Biden was due to resume his operation Thursday, making phone calls to Senate Majority Leader Chuck Schumer and House Speaker Nancy Pelosi.
Not a closed deal
Biden will need the vote of every Democratic Senator to pass the bill down the party lines through the 50:50 split Senate, with Vice President Kamala Harris tied.
One factor that has worked in Biden’s favor so far is public opinion. Americans by and large support raising taxes for the rich and corporate to fund infrastructure and expand benefits for working families.
However, the tax hikes are met with fierce opposition from business groups like the US Chamber of Commerce and the Business Roundtable, who are willing to spend millions of dollars fighting the tax hikes.
Cracks are already showing up in some of the Democrats’ core proposals to generate enough revenue to extend the benefits.
On Wednesday, a plan to give Medicare the power to negotiate prescription drug prices, saving the government billions of dollars, failed in the House of Representatives’ Energy and Trade Committee on Wednesday.
Three Democrats voted together with Republicans against the measure, which the pharmaceutical industry vehemently opposed. After the vote, Democratic leaders began working on a compromise to reintroduce Medicare’s bargaining power into the bill.