Breaking Down Biden's Proposal for a 20% Minimum Tax on the Country's Top Earners
Summary from the AllSides News Team
President Joe Biden's budget plan for the 2023 fiscal year also includes a new minimum income tax on top earners. Is it a good idea, and will it pass?
Announced on Monday, Biden's proposal includes a minimum tax of 20% on the income of American households worth more than $100 million. These people would be required to pay taxes on unrealized gains in the value of their liquid assets, which are typically only taxed when sold. According to the plan, the tax would apply only to the top 1% of the top 1% of households, and would raise close to $360 billion over 10 years. This plan differs from wealth taxes proposed by Sen. Elizabeth Warren (D-Mass.) and others, since it seeks to redefine unrealized gains as income instead of focusing directly on wealth.
Right-rated voices often oppose higher taxes on the wealthy, and in this case, many assail the timing as especially bad given high inflation and the Federal Reserve raising interest rates; some also argue that the proposal would complicate the already-confusing tax code, and that treating wealth as income for tax purposes is unconstitutional. Left-rated voices are often more supportive of higher taxes on the wealthy. Some left-rated voices argued that Biden's proposal could gain public backing and appease the Supreme Court since it's directed at increases in wealth, rather than at pure income, and could encourage the wealthy to inject their capital back into the economy instead of holding onto it.
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