Economists sound alarm on Biden tax hikes

by WorldTribune Staff, March 11, 2020

Joe Biden is proposing several tax increases that would derail the record-setting economy engineered by President Donald Trump, economists say.

The Tax Policy Center reported that Biden’s proposals to raise the corporate tax rate, increase the capital gains taxes on the top 1 percent, and eliminate the Trump tax cuts would amount to a $4 trillion tax hike over the next decade.

Joe Biden’s ‘plan to draw $4 trillion more out of the economy “would crush the market and cause as much as $1 trillion dollars of investment capital to leave the U.S. and flee to foreign nations.’ / Wikimedia Commons

“Biden is a fake moderate,” economist Stephen Moore told Newsmax.

“His voting record in Congress was always one of the most liberal, and one year he had an American Conservative Union rating of zero.”

Grover Norquist of Americans for Tax Reform told Newsmax that while Biden’s proposals may not be as radical as those of Bernie Sanders, they’re still unprecedented.

“Joe Biden’s threat/promise to increase America’s tax bill by $4 trillion over a decade is four times higher than Hillary Clinton’s tax hike of ‘only’ $1 trillion way back in 2016,” Norquist stated.

“And Hillary Clinton refused to consider the energy tax or carbon tax, because it was too radical. Biden adds the energy/gas tax onto all his other tax hikes.”

Moore warned that Biden’s plan to draw $4 trillion more out of the economy “would crush the market and cause as much as $1 trillion dollars of investment capital to leave the U.S. and flee to foreign nations.”

Among the Biden tax proposals that have alarmed economists:

  • Biden wants to increase the corporate tax rate from 21 to 28 percent. The increase would raise $1.3 trillion over a decade. One problem with this approach, economists say, is companies tend to pass along the added cost by reducing employees’ wages, meaning lower income workers would take a hit. Trump’s tax reforms dropped the rate from the highest in the developed world, at 35 percent, to 21 percent.
  • Biden is proposing raising the top capital gains tax rate from the current 23.8 percent to 39.6 percent. Economists worry that would make investments less profitable, and could reduce the amount of capital available to fund new business endeavors.
  • Biden wants to increase the top income tax bracket from 37 percent to 39.6 percent, but that top rate wouldn’t kick in on income over $510,000.
  • Biden would restore the individual mandate in the Affordable Care Act, which the Supreme Court has ruled was a de facto tax. The tax is imposed if a citizen declines to obtain health insurance, as a way to strong-arm them into doing so.

Overall, the Tax Policy Analysis found that the top 1 percent would underwrite 74 percent of Biden’s $4 trillion tax hike over 10 years. But because businesses have to shift their burdens to shareholders and workers, those at the lower end of the economic spectrum would not be left unscathed.

“Higher corporate taxes incentivizes corporations to staff their cash overseas, instead of bringing it back to fuel the domestic economy as has been happening under President Donald Trump,” David A. Patten wrote for Newsmax. “Biden proposes a new tax to eliminate that incentive, to capture as much corporate tax as possible. Businesses would face an alternative minimum tax of 15 percent on their total worldwide revenues, minus a credit for taxes paid to other countries.”

Former White House press secretary Sarah Sanders said that “Anybody who has been listening” to Biden’s policy positions “knows he is extremely liberal and would make an even more dangerous and terrible president. Let’s not forget that he has moved so far to the left; Joe Biden is no moderate.”

In an interview on “Fox & Friends” on Wednesday, Sanders said that the Democratic Party has settled for Biden and that he doesn’t have the temperament or positions the country wants a president to have.

“Donald Trump has had constant levels of enthusiasm and last night, while Joe Biden was still fighting it out with Bernie Sanders, Donald Trump was putting up historic wins for an incumbent in Michigan, in Missouri, in Mississippi, and that was before all of the votes even came in,” Sanders said.

She said a clear choice has been presented to the American electorate: “We can either continue down the path of prosperity and security under this president, or we can go backwards and we can go back to the ideas of the past, of Joe Biden and the Democrat Party that moved so far to the left that they do not identify and line up with most of America. And I think we saw that play out in real-time when he yelled at that guy in a hard hat yesterday.”

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