by WorldTribune Staff, October 7, 2020
Americans under a Joe Biden presidency would pay significantly more in taxes while in a second term President Donald Trump would continue his policy of cutting taxes, according to the Committee for a Responsible Federal Budget (CRFB).
Biden’s spending proposals would also add much more to the federal deficit than Trump’s, the CRFB said in a report released Wednesday.
Biden’s economic policies would increase taxes by about $4.3 trillion while Trump’s would cut taxes by about $1.7 trillion, the CRFB’s report said.
Under Biden’s plan, the largest tax hike would come from an increase in corporate tax rates to 28 percent from 21 percent, the CRFB said.
The Democrat candidate said he would increase the top income tax bracket rate to 39.6 percent from 37 percent. Biden would raise capital gains taxes to 39.6 percent from 20 percent for individuals and couples making more than $1 million and he would eliminate the “stepped-up basis” at death on capital gains for higher earners.
Biden would also increase the payroll tax minimum for Social Security, charge large banks a “financial risk fee,” and have the IRS crack down on tax evasion, according to the CRFB. Biden’s plan also includes a 15 percent minimum tax on “book” profits.
Trump would extend cuts in the Tax Cuts and Jobs Act of 2017. The CRFB also said Trump could support cutting income taxes for those in the middle class, cutting capital gains taxes to 15 percent, indexing capital gains taxes to inflation and cutting the 22 percent marginal income tax rate for individuals to 15 percent.
With just the Tax Cuts and Jobs Act, CRFB’s central and low-end estimates those tax cuts are flat at $1.25 trillion. But with the additional proposals, Trump could potentially cut individual taxes by $2.45 trillion.
Trump’s other proposed tax cuts include breaks for insourcing from China, the expansion of opportunity zones and 100 percent expensing for essential industries.
As for the deficit, Biden’s policies could increase the federal deficit by $8.3 trillion over the next 10 years above what is projected under current law, the CRFB said.
Biden supports a laundry list of spending items that would quickly eat through much of the revenue raised by his taxes, including central estimates of $1.9 trillion for his public health care option and other health policies. Biden would also spend an (low end) estimate of $3 trillion on so-called Green New Deal environment-related projects.
Increased infrastructure spending, at an estimated $2 trillion, is the largest single spending item CRFB identifies for Trump.
CRFB estimates Trump’s spending increases would largely be marginal on issues like school choice while his health care proposals would actually save the government money, as would reduced Middle East troop involvement.