House Speaker Nancy Pelosi and House Committee on Roads and Means Committee Richard Neal (L), a Democrat from Massachusetts, talk about the US-Mexico-Canada agreement, known as the USMCA, at the Capitol Hill, Washington, DC, December 10, 2019.
Saul Loeb | AFP | Getty Images
House Democrats on Monday outlined a series of tax hikes on businesses and wealthy people to fund an investment in the social safety net and climate policy that could reach $ 3.5 trillion
According to a summary published by the Tax Forms and Means Committee, the plan provides for corporate and individual tax rates in excess of 26.5% and 39.6%, respectively. The proposal includes a 3% surcharge on individual income in excess of $ 5 million and a capital gains tax of 25%.
It is unclear how much the tax increases would increase and whether the new revenue would offset the total investment in social programs. Democrats could ultimately reduce the price of legislation as centrists total $ 3.5 trillion.
Fiscal proposals may change before Democrats draft the final bill they hope to pass in the coming weeks. The Forms and Means Committee will debate tax policy when it resumes this week its increase in the large spending package.
Senate Democrats will also have their say in the tax proposals. Senator Joe Manchin, DW.V., has called for a 25% corporate rate, lower than that favored by House Democrats. He has also expressed concern about the plan being added to budget deficits.
The party will need votes from all members of the Senate Democratic group and all House Democrats under three. Senate Majority Leader Chuck Schumer, DN.Y., and House Speaker Nancy Pelosi, D-California, seek to pass legislation through the budget reconciliation process without Republican support.
The House’s fiscal plan would not go as far as President Joe Biden initially expected. The president had called for a corporation tax of 28% and a capital gains rate of 39.6%.
Biden has vowed not to raise taxes on anyone who earns less than $ 400,000 a year.
The House proposal would take huge steps to reverse the Republican tax cuts of 2017. It would increase the corporate rate to 26.5%, after the Republican Party reduced it to 21% from 35%.
Democrats would also restore the individual rate above 39.6% after Republicans cut it to 37%.
The Republican Party has opposed the Democratic plan in part because of the proposed changes to the 2017 law. Republicans would also not reverse any of the cuts as part of the Senate-approved infrastructure bill.
According to the House Democratic Plan, the higher corporate tax rate would apply to revenues in excess of $ 5 million. The first $ 400,000 in revenue would be taxed at an 18% rate.
A rate of 21% would apply to corporate revenue of between $ 400,000 and $ 5 million.
This story is unfolding. Please check for updates again.
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