President Joe Biden’s Build Back Better spending plan would raise taxes on middle-class Americans, according to a study released Thursday, despite the president’s pledge that taxes would only increase for Americans earning $400,000 or more per year.
The Tax Policy Center study instead revealed a significant percentage of middle-income households would pay increased taxes in 2022 based on the current legislation.
“Taking into account all major tax provisions, roughly 20 percent to 30 percent of middle-income households would pay more in taxes in 2022,” the study found.
The estimated tax increases would be small, but would clearly exist.
“Among those with a tax increase, low- and middle-income households would pay an additional $100 or less on average. Those making $200,000-$500,000 would pay an average of about $230 more,” the research revealed.
More concerning would be tax changes for 2023.
“They would shrink the average 2023 tax cuts for low-income households, raise taxes slightly for moderate-income households, and increase taxes significantly for the highest-income households,” the study noted.
Biden has previously noted American families making under $400,000 per year would not “see a penny” in their taxes go up.
“Best of all, the cost of these bills, in terms of adding to the deficit, is zero. Zero. Zero. And I made a commitment when I wrote these when I was running: No one making under $400,000 a year will see a penny in their taxes go up,” Biden said during an Oct. 5 speech in Michigan.
The state and local tax (SALT) deduction cap has also been promoted as part of the spending plan. The Tax Policy Center’s research found that the changes would provide more help for the wealthy than for middle-income households.
“It would reduce their 2021 taxes by an average of only $20. Even those making between $175,000 and $250,000 would get a tax cut of just over $400 or about 0.2 percent of after-tax income. By contrast, the higher SALT cap would boost after-tax incomes by 1.2 percent for those making between about $370,000 and $870,000 (the 95th to 99th percentile),” the study stated.
Republicans have widely opposed the bill as “reckless” spending. Sen. Joe Manchin (D-W.Va.) has also noted concerns with the bill’s spending.
The earlier version of Biden’s Build Back Better bill included a price tag of $3.5 trillion. Democrats were unable to move forward to pass the legislation in the Senate, needing a supermajority of 60 votes to avoid a filibuster.
Further negotiations led through concerns by Manchin and Sen. Kyrsten Sinema (D-Ariz.) have led to a revised version now sitting at $1.75 trillion.
Democrats hope to use a reconciliation process to move forward in the Senate and pass the bill through a simple majority. The current Senate includes a 50–50 tie, with Vice President Kamala Harris serving as the tiebreaking vote.
Every Democratic senator will be needed to pass the legislation, making Manchin a vital part of moving forward with the new bill.
From The Epoch Times