US President Joe Biden is expected to raise the minimum taxes for most billionaires when he announces his draft 2023 budget.
Sunday (27/3), CNBC reported, the US government will increase tax rates on super-rich households in Uncle Sam's country that generate US $ 100 million. More than half of that revenue could come from billionaires who make more than $1 billion in revenue.
"This minimum tax will ensure that the richest Americans no longer pay lower tax rates than teachers and firefighters," reads the document obtained by CNBC.
According to the document, the proposed levy is expected to reduce the deficit by about US$360 billion in the next decade. If these rich people had already paid 20% of their income, then they would not have to pay any additional taxes.
Conversely, if they pay less than 20%, they will be in debt to meet the minimum tax. As a result, this tax would deprive the super-rich households of the unrealized income capability. So they won't be taxed in decades.
The new tax proposal is part of a planned 2023 budget that is expected to be released this Monday. The new spending plan will cut $1.3 trillion from the deficit over the next decade.
However, the draft policy is still awaiting a congressional decision. Last year, Senate Democrats rolled out a tax on billionaires and would levy unrealized capital gains from the richest Americans. This plan was ultimately discontinued.
Based on data from the US Congressional Budget Office, the federal deficit stood at nearly $2.8 trillion - about $360 billion in fiscal 2021. That's more than realized the previous year.
The rapid economic recovery after the pandemic lows was also a factor in reducing the deficit. The White House praised America's rescue plan, created to support aid to Americans struggling during the Covid crisis, for helping the economy grow 5.7% in 2021.
Not only is less economic and pandemic support needed for people and businesses, but a stronger economy means higher incomes for households and businesses.
As such, the government is projected to collect more than US$300 billion in additional revenue compared to last year.
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