■ President Joe Biden’s proposed $6 trillion budget would run a $1.8 trillion deficit.
Tax hikes on wealthy, businesses factored in
WASHINGTON — President Joe Biden’s $6 trillion budget proposal for next year would run a $1.8 trillion federal government deficit despite a raft of new tax increases on corporations and high-income people designed to pay for his spending plans.
Biden had already announced his major budget initiatives, but during a rollout Friday, he will wrap them into a single proposal to incorporate them into the government’s existing budget framework, including Social
Security and Medicare. That provides a fuller view of the administration’s fiscal posture.
Capitol Hill aides confirmed key elements of the Biden plan, which were first reported by The New York Times on Thursday. They spoke on condition of anonymity because the document is not yet public.
The whopping deficit projections reflect a government whose steadily accumulating pile of debt has topped $28 trillion after well more than $5 trillion in COVID-19 relief.
The government’s structural deficit remains unchecked, and Biden uses tax hikes on businesses and the wealthy to power huge new social programs like universal prekindergarten and large subsidies for child care.
Under Biden’s plan, the debt held by the public would exceed the size of the economy and soon eclipse record levels of debt relative to gross domestic product that have stood since World War II.
That’s despite more than $3 trillion in proposed tax increases over the decade, including an increase in the corporate tax rate from 21 percent to 28 percent, increased capital gains rates on top earners, and returning the top personal income tax bracket to 39.6 percent.
Like all presidential budgets, Biden’s plan is simply a proposal.
It’s up to Congress to implement it through tax and spending legislation and annual agency budget bills.