Biden Determined to Tax the Rich After Windfalls From Covid Crisis
President Joe Biden’s economic team at the White House is determined to make good on his campaign pledge to raise taxes on the rich, emboldened by mounting data showing how well America’s wealthy did financially during the pandemic.
With Republican and business-lobby opposition to the administration’s tax plans stiffening, Democrats need to decide how ambitious to be in trying to revamp the tax code in what’s almost-certain to be a go-it-alone bill. Interviews with senior officials show there’s rising confidence at the White House that evidence of widening inequality will translate into broad popular support for a tax-the-wealthy strategy.
Biden himself has become convinced of the need, saying last week that those earning over $400,000 can expect to pay more in tax.
“2020 really did show him that there were so many of the fragilities across society” that need addressing, Heather Boushey, a member of the White House Council of Economic Advisers, said in an interview. Funding spending priorities given a shortfall in revenues from the 2017 Republican tax cuts “has really demanded the president sit down and think about both the enormous needs, and these questions we’re talking about as to how we tax,” she said.
Behind the scenes, aides have been working on a proposal to pay for some of the longer-term Biden agenda. Boosting income and capital-gains tax rates on top earners, along with levies on companies and an expansion of the estate tax, would help fund priorities such as infrastructure, climate change, and assistance for child care and home health care.
Lawmakers and the administration are stepping up discussions about what measures could pass later in the year. The Senate Finance Committee on Thursday will hold a hearing on the impact on employment and investment of the current U.S. international tax structure.