President Biden on Thursday proposed a record-shattering $6.8 trillion budget that envisions a significant surge in social program spending and roughly $5.5 trillion in new taxes.
The budget, which would set the U.S. on a course for higher spending as a percentage of the economy than ever before, calls for an 8% increase over what the government is projected to spend in the current fiscal year.
Thursday’s release is a budget outline for fiscal 2024 revealing all the details of his priorities that will be sent to Congress next week.
Either way, Mr. Biden‘s budget is an aspirational document that isn’t expected to go anywhere with a Republican-controlled House and narrowly-divided Senate. But it serves as a loud campaign message for a president seeking reelection.
In a speech in Philadelphia, the president will underscore that his budget plan lays out his vision for America. He chose as his site the largest city in a key swing state that will be pivotal to winning the presidency in 2024.
Even before Mr. Biden‘s proposals hit Capitol Hill, Republicans were knocking down the increases in spending and taxes.
“President Biden has spent more money in the first two years of his administration than any other president in American history — resulting in record inflation, crippling tax hikes and bloated bureaucracy,” said Rep. Jake LaTurner, Kansas Republican, in a statement ahead of the budget’s release.
Mr. BIden is seeking to pay for the spending spree and reduce the deficit through a series of new tax increases on billionaires, wealthy investors and corporations.
All told, Mr. Biden is calling for roughly $5.5 trillion in taxes over the next decade, which he expects would shave $3 trillion from the federal deficit.
The budget request proposes a 25% minimum tax on individuals whose wealth exceeds $100 million, and nearly doubles the capital gains tax rate for investments to 39.6% from its current level of 20%.
Mr. Biden is also urging Congress to raise taxes on corporations and wealthy Americans. He called for the corporate tax rate to be raised to 28% and for increasing taxes on corporations’ foreign earnings to 21%, from the current 10.5%.
The budget also calls for quadrupling the tax on corporate stock buybacks tax and closing a tax loophole that allows individuals to claim large parts of their compensation as investment gains, enabling them to pay lower taxes on wages and other compensations.
Mr. Biden‘s tax proposals are largely a reprise of his multi-trillion-dollar Build Back Better economic package that failed to gain any traction in Congress, even with a Democrat-controlled House. The proposals were eventually removed from his paired-down economic plan, known as the Inflation Reduction Act.
White House budget Director Shalanda Young acknowledged the tax hikes will likely be dead on arrival, saying the measures are the “start of a healthy dialogue.”
“This shows you what he values and what he is about and we are happy to have that debate with anyone,” Ms. Young said of the president. “We will propose tax policies that say to the richest Americans and large corporations that you have to begin to pay your fair share so that we can continue to invest in working families in America.”