Ever since Joe Biden has come to power, he has been facing a lot of problems regarding the economy of the country. According to experts, the new plans brought in by Joe Biden are going to impact the economy harshly. There are short-term benefits and there are long-term benefits that need to be identified by him. For such an economic revival with so many taxes being imposed on the people, it seems as if he is looking at short-term possible credit for needy families. In the long run, these economic policies are going to harm the common American citizen.
It is a common claim by many that his tax imposition is targeting the rich class of the society. Whereas the middle class will be saved from heavy taxes as their income spectrum is low. It is believed that the economists are overlooking many facts regarding this plan of Biden. The middle class will also be impacted as much as the rich class of the society with these tax impositions. Biden must rethink the economic policy, so the people are relieved in these times of distress. The side effects of coronavirus have yet to be forgotten before these taxes are imposed.
If the economists look closely at the proposed changes put forth by Biden, the overall economy is to suffer by the year 2030. Very few people are looking at the overall impact on the GDP and the unemployment ratio in the future. The overall house income is going to take a hit of $6500 in the annual income budget of a common family. That is a huge amount as compared to before and must be taken into consideration before these taxes are imposed.
Biden has been prioritizing the middle-class families who have taken a major hit because of the coronavirus impact. But his new economic policy is not soothing for these middle-class families as they are the ones suffering a lot. The plan given by Joe Biden is only feasible if the people can recover from the coronavirus side effects soon. Otherwise, for a country where citizens have been losing their homes, it is very difficult for them to pay taxes. These taxes are also going to impact the labor class who are going to pay an increased 2.4% tax.
This new piece of information is devastating for the people who were looking forward to Biden’s economic policies. He has been promising that the people earning less than $400,000 will not be affected by the tax raises. But clearly, the new economic policy is going to harm the people who are earning less than $400,000 as well. The overall promise being made by Biden’s campaigners and VP, Kamala Harris does not seem to be fulfilling in the future.
It is a difficult development to digest for a common man to have seen a president speaking for themselves not fulfilling their promise. This is the kind of burden that the people must face in the coming days because of the economic impact of coronavirus. The COVID-19 has pushed the economic conditions of the United States of America far behind the rest of the world. It is time to take difficult steps so that the economy can be revived in the future.
The unique feature of Biden’s tax plan is tax increase. However, this tax increase is not a “one size fits all” tax increase for everyone, but a tax increase for the rich and large companies. In fact, Biden’s tax plan also contains some tax cuts for ordinary people. For example, the individual tax plan is to increase the tax credit for children under the age of 17.
Biden’s tax plan also includes a plan to increase corporate income tax, which is to increase the current tax rate from 21% to 28%, and implement a minimum tax system for companies with a book profit of 1 million US dollars, that is, companies must follow normal calculations. The larger amount of the corporate income tax and the 15% minimum tax is subject to corporate income tax.
In order to restrict companies from providing employment opportunities to foreign countries, Biden’s tax plan also devices to impose a 10% additional tax on those American companies that produce overseas but sell their products back home, bringing the tax rate of these American companies to 30.8%.
According to estimates, after the tax plan, by 2030, the after-tax income of the highest earners of 1% of U.S. taxpayers will drop by 7.7%. In addition, there are also supporting views that increasing taxes on the rich can alleviate the US budget deficit and debt problems to a certain extent.
The government has been providing possible credit to the people during this COVID-19 situation. And it is now time that the government now starts taking back in the form of taxes. The tax cuts being provided by Trump will be repealed by Joe Biden under this new economic policy. But it is still unclear whether Biden’s administration is going to go ahead with this plan of tax imposition. The overall impact of the coronavirus is still under study and Biden’s administration does not want people to be burdened at this point.
Another important aspect of this taxon position is to change the way a person saves for his retirement. This economic policy is targeting the people so that they have increased incentives by the time they retire. Another aspect to note here is that people who are looking to buy their own homes will be given a $15,000 tax credit. Similarly, this economic policy will not only be targeted towards the senior citizens but will also look out for the disabled ones. Although new taxes are being imposed, some of the classes of the society will be given tax credits as well. It is time to believe in the new economic policy.
Regarding Biden’s tax plan, various sectors of the United States has mixed reactions. Those who agree are basically considered from the perspective of social justice, thinking that the rich should pay more taxes.