President Joe Biden’s plan also targets corporate tax reforms and closes investment income loopholes, aiming for fairness.
President Joe Biden’s latest budget proposal seeks to increase taxes on nearly 3 million top-earning Americans, rolling back Trump-era tax cuts for the wealthy in an effort to cut the national deficit by $3 trillion over the next decade.
Under the proposed budget for fiscal year 2025, which would cost a total $7.3 trillion, the wealthiest Americans—those earning more than $400,000 annually—will see their taxes rise, as the plan restores the top tax rate to 39.6 percent from the current 37 percent instilled by former President Donald Trump when he signed the Tax Cuts and Jobs Act of 2017 into law.
The adjustment reverses the 2017 tax law’s benefits to the top earners, ensuring the affluent pay their fair share.
Based on 2021 IRS data, Newsweek previously estimated that 1.8 percent of all tax returns fall into the income range exceeding $400,000 annually. The estimation suggests that roughly 2.5 million of the returns filed are from individuals or households within the $250,000 to $500,000 income bracket, with about one-quarter of them surpassing the $400,000 mark.
In a bid to address the disparity in how income is taxed, the budget, detailed in a press release issued by the White House on Monday, also proposes major reforms to capital gains taxation.
