Biden Tax Plan Gets Shredded Down in Battle to Raise Revenue

Asia's Tech News Daily

(Bloomberg) — President Joe Biden’s tax agenda, crafted by experts who worked on the proposals for years and wrote books about their ideas, is getting a wholesale revamp as Democrats battle to find a program their caucus can unite behind.

Most Read from Bloomberg

  • A Deep Dive Into Squid Game’s World of Inequality
  • Meet Six People Fighting Water Scarcity Across the Globe
  • Hamburg Is at the Heart of Germany’s Growing Dilemma Over China

Amid diplomatic — at least in public — bickering among the chairs of the House and Senate’s top tax-writing committees and other stakeholders, the two main takeaways as of Wednesday evening were: the bulk of former President Donald Trump’s 2017 tax cuts will be left in place, while corporations will face a new minimum levy.

It’s far from clear what measures will make the final cut as lawmakers negotiate over the revenue-raisers to pay for what could be a $2 trillion social-spending bill. Biden is set Thursday to announce an agreement on a framework of tax and spending proposals that he’s optimistic Congress can pass, a person familiar with the matter said. But it’s unclear how far-reaching the accord will be and what issues remain unresolved. 

Wednesday began with details of a Senate plan for a new billionaires’ tax and Majority Leader Chuck Schumer announcing his hope for a framework deal by day’s end. By evening, the House had rejected that billionaire levy and Senate Budget Committee Chair Bernie Sanders said “it’s not conceivable” for an agreement that night.

Comments from lawmakers indicate that some of Biden’s core proposals — including increasing the corporate income tax rate, the top marginal income tax rate and the capital gains rate — are likely out, while other, more creative ideas, –like a minimum tax on the profits on corporate financial statements and a surtax on millionaires — were still in the running.

Likely InLikely OutDefinitely OutStill an Option






15% corporate minimum “book” tax Billionaires tax Eliminating step-up in basis on inherited assets Surtax on millionaires
15% global minimum corporate tax IRS bank-account reporting
Expansion of 3.8% investment tax Eliminating carried interest
IRS audit expansion Corporate rate hike
Tightening of international corporate tax rules Higher top individual rate
Limitation of business losses Capital gains rate hike

Senator Kyrsten Sinema of Arizona, a crucial swing vote for Democrats, has given the Biden administration a list of specific tax policies she will support in order to raise revenue for the social spending plan, people familiar with the matter said Wednesday night. 

Biden Tax Plan Gets Shredded Down in Battle to Raise Revenue
© Bloomberg Democrats Detail Billionaire Tax To Fund White House Spending Plan

She would back the billionaires’ tax put forth by Senate Finance Committee Chairman Ron Wyden or a 3% income surcharge for earners above $5 million, as well as a 15% corporate minimum tax, the people said on condition of anonymity to discuss sensitive negotiations.  

Some Democrats are frustrated their once-in-who-knows-how-long chance to make the tax code more progressive will, at best, be incomplete. What was originally envisioned — and could still result — was the first major comprehensive package of tax increases since 1993, the first year of the Clinton administration. With razor thin majorities in the House and Senate, there’s no telling whether Democrats will be able to come back for more after the 2022 midterm elections.

“It seems to be almost every sensible progressive revenue option that the president wants, that the American people want, that I want seems to be sabotaged,” said Sanders, a Vermont independent who caucuses with the Democrats.

Biden Tax Plan Gets Shredded Down in Battle to Raise Revenue
© Bloomberg Democrats Detail Billionaire Tax To Fund White House Spending Plan

The last-minute rewrite of the tax plan is the result of Democrats scrounging for tax options to appeal to two holdout Democrats, Sinema and Senators Joe Manchin of West Virginia. Sinema’s opposition to tax-rate increases and Manchin’s resistance toward a plan to require banks to report more tax data to the Internal Revenue Service may mean that Democrats will have throw out some of Biden’s ideas that raise the most tax revenue.

House Ways and Means Chairman Richard Neal said that the bill would have to “mollify” the demands of those two senators to make it through Congress. The eleventh-hour deal-making reflects the need for the caucus to stay united in face of concerted Republican opposition.

Democrats are also likely to abandon Biden’s ambitious proposal to expand inheritance levies, by removing a benefit that allows some assets to be passed to heirs tax-free, known as step-up in basis.

Scaling back presidential proposals is part of the typical legislative process in Washington. The executive branch proposes its grand vision, and then 535 members of Congress get to debate and revise that plan. 

Yet Biden’s tax agenda has taken an unconventional path as lawmakers have picked some pieces and rejected others.

Some of the tax increases seen by many Democrats as politically the easiest — reversing the Trump tax cuts on corporations and individuals, as well as eliminating the carried interest tax break for private equity — are now candidates to get dropped. And some of the more complicated approaches — like Biden’s plan for a corporate minimum levy on profits reported on financial accounts — have the support of all 50 Senators.

White House Press Secretary Jen Psaki said at a briefing Wednesday that “the president certainly knows there’s some agreements and some disagreements about which components of a range of tax-fairness proposals are the best options. That’s why there are so many out there that he has proposed, that others have proposed, that what we’re doing now is working through what will be in the final package.”  

Lisa Zarlenga, a former Treasury tax legislative counsel, still estimates that the Biden administration has managed to get quite a few of its proposals — at least in part — into the legislation being considered, when compared with previous presidents.

An expansion of the net investment income tax — a capital gains surtax on high-earners — is still in the mix, and Congress has kept most of Biden’s plans to overhaul the international tax system in tact, with some minor changes, she pointed out.

‘A Pretty Good Percentage’

“It’s actually probably a pretty good percentage,” Zarlenga said.

But for many progressives, the tax increases weren’t just about finding dollars to fund new social spending, they were also about addressing wealth and income inequality. Besides the spending elements of the bill, the legislation was a chance to reshape the tax code to shift more of the burden on the wealthiest Americans — who have many options to reduce or defer their tax bills.

“The lack of inclusion of both the corporate rate and the individual rate and the failure to include the capital gains rate — that’s a big loss,” said Frank Clemente, the executive director of Americans for Tax Fairness. “We will come back another day.”

(Updates with Biden’s Thursday announcement in third paragraph.)

Most Read from Bloomberg Businessweek

  • Workers Press for Power in Rare Advance for U.S. Labor Movement
  • Australia Braces for Life After Covid Zero
  • You Could Be Competing With Bots to Buy Gifts This Christmas
  • Colombia’s Rain Shaman Got Paid to Stop the Storms, Until He Couldn’t
  • Big Teacher Is Watching: How AI Spyware Took Over Schools

©2021 Bloomberg L.P.

Internet Explorer Channel Network
Asia's Tech News Daily
News Related


How to retire with £500,000 - Pension saving tips from your 20s to your 50s

Most people are well aware of the importance of putting plans in place and saving money towards their pension. However, knowing how much to put away in order to achieve ... Read more »

Meet the Pageant Coach Behind These Filipina Beauty Queens' Signature Walks

© Provided by At the Araneta Coliseum on March 15, 2015, Pia Wurtzbach was crowned as Miss Universe Philippines 2015. Her supporters in the crowd were absolutely livid, roaring ... Read more »

Zia Dantes Had The Most Adorable Teddy Bear-Themed Party For Her 6th Birthday

© Provided by Cosmopolitan Philippines Zia Dantes just turned six, and she had the most charming teddy bear-themed party. Marian Rivera took to IG on Saturday to share photos from ... Read more »

Eternals: The Next Stage in the Evolution of the Marvel Universe

© Provided by © Provided by The Eternals when they first arrive on Earth in 5000 BC. PHOTO courtesy of disney philippines ( “Don’t they know it’s the end ... Read more »

Blue Jays add to bullpen, agree to two-year, $11M deal with Yimi Garcia

The Toronto Blue Jays have added some depth to the bullpen by agreeing to a two-year, $11-million contract with veteran right-hander Yimi Garcia, Sportsnet’s Shi Davidi reports. © Ashley Landis/AP ... Read more »

China study warns of 'colossal' COVID outbreak if it opens up like U.S., France

A security guard blocks an exit as he directs people to scan a QR code to track their health status at Shanghai Hongqiao Railway Station BEIJING (Reuters) – China could ... Read more »

Middle Tennessee comeback overcomes Florida Atlantic, 27-17

BOCA RATON, Fla. (AP) — Mike DiLiello ran for one touchdown and passed for another and Middle Tennessee scored 24 unanswered points to earn a 27-17 come-from-behind win over Florida ... Read more »

Donovan Mitchell leads Jazz past Pelicans, 127-105

SALT LAKE CITY (AP) — Donovan Mitchell had 21 points, seven rebounds and seven assists to help the Utah Jazz beat the New Orleans Pelicans 127-105 on Saturday night. Mike ... Read more »

No. 5 Notre Dame beats Stanford 45-14, awaits playoff fate

STANFORD, Calif. (AP) — Jack Coan threw two touchdown passes and ran for another score and No. 5 Notre Dame finished off the regular season with a 45-14 victory over ... Read more »

MoU pastikan Ismail kekal berkuasa, dakwa Kit Siang

© Provided by Free Malaysia Today Tanpa MoU itu, ia mungkin menyebabkan berlakunya ketidakstabilan politik hingga menyebabkan negara terpaksa melantik seorang Perdana Menteri yang baharu, menurut Lim Kit Siang. (Gambar ... Read more »

Britons can achieve early retirement - but famous 4% rule on income has ‘big risks'

Financial Independence, Retire Early, or FIRE as it is commonly known, is a goal set by increasing numbers of people keen to depart the workforce before the traditional age of ... Read more »

Widow, 73, left worrying he'd 'be kicked out of his house' due to mortgage 'nightmare'

One in three mortgage borrowers may be overpaying on their mortgage, FCA figures show, and the long term effects could lead to an increase in ‘mortgage prisoners’. A recent survey ... Read more »

Iran: Protests on water shortages turn violent as police arrest 67

© Provided by Some reported internet outages in the areas staging protests Protests in the Iranian city of Isfahan over the drying up of a river turned violent, as ... Read more »

$123,000 federal grant will help Framingham police find missing people

FRAMINGHAM — The Framingham Police Department will use a federal grant that will help it find missing people quicker, particularly those who are at risk. The department received nearly $123,000 ... Read more »

Janhvi Kapoor shows verbal fighting skills in hilarious video, Arjun Kapoor thinks she ‘needs help'. Watch

© Provided by Hindustan Times Janhvi Kapoor in stills from a fun video on Instagram. Janhvi Kapoor has shared a funny video of her imitating Bigg Boss 5 contestant Pooja ... Read more »

WATCH: Nathan Smith Takes a Blinder in Super Smash T20 Match

© Provided by News18 WATCH: Nathan Smith Takes a Blinder in Super Smash T20 Match New Zealand’s premier Men’s T20 domestic tournament – Super Smash T20 2021-22 got underway on ... Read more »

Indian Super League: ATK Mohun Bagan school SC East Bengal with a 3-0 victory

© Provided by The Times of India The pandemic-ridden world has undergone too many changes over the past one year. But something remains static in the world of Indian club ... Read more »

Giants limp into Eagles' matchup looking to erase memories of ‘MNF' beatdown

This could have been so juicy. Instead, it is as dried out as 4-day-old Thanksgiving turkey. This could have been dripping with more than the usual venom that ordinarily oozes ... Read more »

When Salman Khan Urged Jacqueline Fernandez to Try Farming in Panvel, Called Her Foolish for Running on Treadmill

© Provided by News18 Bollywood star Salman Khan was the recent guest in The Kapil Sharma Show to promote his film Antim: The Final Truth, where he shared an anecdote ... Read more »

Making money from handbags - do you have a 'high demand' bag in your wardrobe?

Designer handbags appreciate in value every year by an average of 13 percent, outperforming stocks and shares investments, research suggests. Handbag Clinic CEO Charlotte Staerck exclusively shared her top tips ... Read more »

Investing in gold and silver for retirement - could you boost your income?

Gold is often seen as one of the most stable and lucrative investment opportunities, but investing in gold doesn’t start and end with hiding a gold bar under the bed. ... Read more »

What Ralf Rangnick should expect as Manchester United manager

Ralf Rangnick will be hit by the “privilege and responsibility” that comes with managing Manchester United as soon as he walks through the doors at Old Trafford for the first ... Read more »

Pension alert: Savers 'unaware of inflation risks' as retirement funds are moved into cash

Pension contributions, specifically workplace or private schemes, are usually invested into the markets to better chances of ensuring a comfortable retirement. However, in recent years pension holders were given more ... Read more »

Retirement and me: 60-year-old helps seniors 'increase income' with simple online platform

60-year-old Suzanne Noble has had an exciting career that has seen her work in TV production, PR and head up her own company selling baby slings. She has no plans ... Read more »

Porsche-Boss: „Bauen Sport-, nicht Schlafwagen“

Porsche-Chef Oliver Blume über die elektrische Zukunft und die des 911 © REUTERS/ANDREAS GEBERT Der Porsche-Chef nahbar und gelassen – so zeigt sich Oliver Blume bei der Autoshow in Los ... Read more »

Edwards scores 22, No. 20 Kentucky rolls past LaSalle, 74-52

LEXINGTON, Ky. (AP) — Dre’una Edwards scored 22 points and pulled down 11 rebounds to lead the No. 20 Kentucky women to a 74-52 win over LaSalle on Saturday. The ... Read more »

UAE-UK health pact 'boosts exports of life sciences innovation'

© Provided by The National Prime Minister Boris Johnson’s government set out its 10-year UK Life Sciences Vision in July to build on the success of Britain’s Covid-19 response. Getty ... Read more »

'A grand artistic dream': on the eve of Union, Umm Kulthum sings for Abu Dhabi

© Provided by The National Photo: Al Ittihad Could it be true? Al Ittihad newspaper broke the news in typically flamboyant style: “A grand artistic dream is materialising these days. ... Read more »

Ahead of Parliament's Winter Session, Union minister Pralhad Joshi to meet party floor leaders today

The Winter Session of Parliament is scheduled to begin on November 29. (Photo: PTI) Ahead of the Winter Session of Parliament, Union Minister of Parliamentary Affairs Pralhad Joshi is scheduled ... Read more »

In a bid to get rid of anonymous trolls, Australia to come up with new laws

© Provided by WION One major disadvantage of social media is that it allows massive trolling based on anonymity, hampering the mental health of many people. However, now many countries ... Read more »

Covid news, GDP nos & two IPOs among key factors to drive market this week

NEW DELHI: Two IPOs, auto sales numbers, PMI readings, quarterly GDP data, core sector data, the kick start of the winter session of parliament, and above all, the unfolding of ... Read more »

Aussie Rapunzel reveals why you should always use heat protector spray

© Provided by Daily Mail MailOnline logo A model has used a single piece of bread to demonstrate the importance of using heat protector spray when straightening your hair. The ... Read more »

Philippines has administered 80M+ COVID jabs so far —NTF

Hundreds of residents from zone 51, 52 and 55 in Sampaloc, Manila wait to receive a first dose of Moderna’s COVID-19 vaccine during the launching of Manila’s 24/7 vaccination at ... Read more »

Man City transfer roundup: Ferran Torres wants exit as Barcelona 'consider £59.3m offer'

It would be no surprise if Manchester City made a move to sign a centre-forward in January. What would be a shock is if they sold one of the few ... Read more »

Australia will introduce legislation requiring social media companies to reveal anonymous users who post defamatory comments

© Provided by Business Insider Lincoln Beddoe/iStock/Getty Images Plus Australian PM Scott Morrison announced social media anti-trolling legislation on Sunday. The legislation places the onus of moderating defamatory content on ... Read more »

Gelingt Chieffo Ähnliches wie einst Seoane?

© KEYSTONE/URS FLUEELER U21-Trainer Sandro Chieffo führt die gebeutelte Mannschaft des FC Luzern am Sonntag im Heimspiel gegen Basel erstmals als Interimstrainer an. Es werden Erinnerungen an den Winter 2017/18 ... Read more »

Zwei Verletzte nach Frontalkollision

Am Samstagabend kollidierten auf der Weisslingerstrasse zwei Fahrzeuge frontal ineinander. Die 35-jährige Fahrerin zog sich beim Unfall schwere Verletzungen zu. Der 65-jährige Fahrer, der nach ersten Erkenntnissen den Unfall verursachte, ... Read more »

Israel macht im Kampf gegen neue Coronavirus-Variante Grenzen dicht

© Keystone/AP/Maya Alleruzzo Um die Ausbreitung der neuen Omikron-Variante des Coronavirus einzudämmen, schliesst Israel seine Grenzen für Ausländer. Diese und weitere Beschränkungen beschloss das Coronavirus-Kabinett laut israelischen Medienberichten am Samstagabend. ... Read more »

Bradley Beal scores 26 points, Wizards beat Mavs 120-114

DALLAS (AP) — Bradley Beal scored 26 points, Kyle Kuzma had 10 of his 22 in the fourth quarter and Kentavious Caldwell-Pope scored the clinching four points in the closing ... Read more »

Jenkins' late TD lifts LSU past No. 14 Texas A&M, 27-24

BATON ROUGE, La. (AP) — Max Johnson hit Jaray Jenkins with a 28-yard scoring pass down the right sideline with 20 seconds left, and LSU knocked off No. 14 Texas ... Read more »
On you will find lots of free English exam practice materials to help you improve your English skills: grammar, listening, reading, writing, ielts, toeic