The Biden administration in the United States announced on the 11th a budget plan for fiscal year 2025 of $7.3 trillion.
The plan aims to reduce the fiscal deficit through increased taxes on the wealthy and corporations and secure funds for new low-income support programs. However, the likelihood of the U.S. Congress constructing the budget this way is low.
According to Bloomberg, the budget plan includes raising the minimum corporate tax rate from 21% to 25% for the top 0.01% of the wealthy. The tax rate applied to stock buybacks will also increase from 1% to 4%.
The budget includes provisions to provide monthly tax deductions to some homeowners to offset the impact of high mortgage interest rates. It also mentioned the government’s new authority to reduce prescription drug prices and provide child support.
The government expects tax revenue to increase by $4.951 trillion over the next ten years. This includes more than $2.7 trillion through corporate tax increases and about $2 trillion from taxes on the wealthy. The fiscal deficit is expected to decrease by $3 trillion over the same period.
The budget plan assumes discretionary spending unrelated to mandatory expenses like Social Security at $1.671 trillion. It requested $895 billion for defense. It proposed an increase of $63 million for the judiciary’s antitrust budget.
Bloomberg reported that this year’s budget plan details the policies of President Biden, who is seeking re-election ahead of the November presidential election. However, with Congress divided by parties, the likelihood of passing the budget proposal remains slim.
The Wall Street Journal (WSJ) also noted, “While this proposal may not gain traction in Congress, it will serve as a cornerstone of the election campaign in mind of former President Donald Trump with a contrast to the economic policies of election rival.”
Most Commented