According to a new study from the Tax Foundation, President Biden’s American Families Plan would increase the combined state and federal capital gains tax rate. In California, the federal, state, and local taxes would increase from 27.1% to 56.7%, which represents the highest among the 50 states. The current combined average rate is about 29% but would be 48.4% under the President’s tax proposal. All of Biden’s plans are about buying votes and pandering to identity politics.
Republican Sen. Bill Hagerty lashed out at the president’s “feckless” economic and foreign policies, adding that the answer is not to raise taxes on corporations and millions of wealthy earners at a time when Americans are dealing with high inflation levels. He said the $3.5 trillion budget resolution is another “reckless tax-and-spending spree” that will make things harder for American workers.
“Look at the inflation that’s happening right now. That’s a hidden tax on middle America, and all of the policies that they’re putting forward are so damaging our economy,” Hagerty said.
The Tax Foundation Report points out that a total of 13 states would see a combined capital gains tax rate above 50%.
President Biden has also proposed that the trillions of dollars of new tax increases would not touch anyone earning less than $400,000. This, however, isn’t true. People pay corporate taxes, corporations don’t.
A recent Tax Policy Center study found that most 2022 households would pay more taxes under the plan and that about three-quarters of middle-income taxpayers would face a tax increase. The study found that the numbers would lead to a “significant reduction” in workers’ incomes. It would increase the consumer retail price and energy bills for households.
Even the Wall Street Journal called Biden’s plan, “The Dumbest Tax Increase,” adding that it would reduce federal revenue overall due to less business activity. They quoted former Democratic President John Kennedy, who told Congress that a capital gains tax affects investment decisions, the mobility and flow of risk capital, the ease or difficulty in obtaining it, and overall leading the potential for economic growth.
Tax policies have always been about creating opportunities where more people can launch and grow their own businesses. If Dems were fiscally responsible, they’d leave the economy to rebound post-pandemic under the current tax policies implemented by the Trump Administration. Under former President Donald Trump, the country saw the lowest unemployment rate at 3.5%, in 50 years.
Biden is also working with more than 100 countries to pass a 15% global minimum tax that ensures corporations pay their fair share. Republicans have warned that this would be a “sweetheart deal” for foreign countries because they could maintain a lower tax rate for their own companies in foreign markets than American companies. It would send U.S jobs overseas, undermine the economy, and strip away the U.S tax base.
Sen Pat Toomey called the move “destructive” and said the Biden Administration is eagerly working in a “race to the bottom.” The taxes would be a loss for the U.S economy that would reduce investments and increase compliance costs.
This is just one more cost to the consumer and the American worker. Biden understands who really pays for his proposed tax increases and it’s all a part of ensuring that China becomes the preeminent economic power. Democrats will tax their way to a one-world government however they can.