President Biden’s top economic adviser, Lael Brainard, delivered a powerful speech on Friday outlining the administration’s plans for the upcoming tax debate next year. In her address to the Hamilton Project at the Brookings Institution in Washington, Brainard emphasized the need to sharply raise taxes on corporations and the wealthy in order to reduce budget deficits.
Under President Biden’s proposed plan, tax cuts for individuals earning $400,000 a year or less would be maintained, while taxes on high earners and large corporations would be increased. This move is aimed at offsetting the cost of extending certain tax cuts set to expire at the end of next year, which were implemented under former President Donald J. Trump in 2017.
Brainard’s speech highlighted the administration’s commitment to reducing taxes for middle-class Americans while ensuring that the wealthy and corporations pay their fair share. She stressed the importance of addressing the growing debt and deficits, stating that any tax cuts extended should be fully paid for to avoid worsening the fiscal hole created by previous Republican tax cuts.
The upcoming tax debate is expected to be a major point of contention between Democrats and Republicans, with President Biden advocating for targeted tax cuts for lower-income households and increased taxes on the wealthy. The administration’s latest budget proposes nearly $5 trillion in tax increases on high earners and corporations, along with $2 trillion in new spending programs.
Brainard also mentioned specific measures that the administration may pursue, including raising the corporate tax rate to 28 percent and maintaining limits on tax deductions for households earning over $400,000 a year. Additionally, she called for additional tax assistance for lower- and middle-income Americans, such as restoring the enhanced child tax credit and making permanent a tax credit to help people buy health insurance through the Affordable Care Act.
Overall, Brainard’s speech provides a detailed insight into President Biden’s tax policy priorities and sets the stage for what promises to be a contentious and crucial tax debate in the coming year.
