Joe Biden wants to tax the richest to finance his New Deal
Audio 03:43
US President Joe Biden wants capital income to be taxed equally with labor income.
He will detail his project this Wednesday April 28 in front of the Congress.
© REUTERS - JONATHAN ERNST
By: Dominique Baillard Follow
8 mins
To finance his plan for the family, President Joe Biden wants to tax the richest.
He will detail this reform this evening before Congress.
Once again, the new president of the United States is breaking with the ultra liberalism dear to America.
Publicity
Long live the tax! This is the new credo of the head of the White House. He first announced the increase in taxes on businesses. It is now attacking the wealthiest households. Those who earn more than a million dollars a year. In his sights: the capital gains realized on the Stock Exchange. He wants to double the tax rate on financial gains, for the highest bracket his goal is to increase it to 43%. The principle: that capital income is taxed equally with labor income. The top marginal rate on labor income will also increase, but by only three points, to also exceed the 40% threshold. The wealthiest families are the first to be affected. Those who get richer thanks to the euphoria of Wall Street.
It is in the name of reducing inequalities that Joe Biden wants to increase these taxes
The US economy is recovering, but inequalities remain glaring. They widened during confinement. With on the one hand tens of millions of Americans unemployed, dependent on public aid. And on the other, the CEOs who have decided their fate, seeing their revenues explode in 2020, even when their company has almost come to a standstill. Two examples: first that of the boss of Boeing, who gave up a large part of his salary, limited this year to $ 200,000; but in compensation he received shares in the amount of $ 21 million. The boss of Norwegian Cruise Lines, a company that came close to bankruptcy because of the stoppage of cruises, has doubled his annual income to $ 36 million. And these are just examples among others,the richest earn more and more, even in times of crisis, while the middle class is struggling.
How is this reform perceived by taxpayers?
According to the latest polls, the middle class supports these tax increases. The richest, on the other hand, are much less enthusiastic. When the content of the reform was disclosed last week, Wall Street loosened for a few hours, before resuming its normal activity for ten years, that is to say the race to the top. As it stands, this reform spares three quarters of shareholders. Those for example who have invested in the stock market for their pensions will be exempt. The impact will therefore be limited on stock market activity, even if the financiers claim the opposite. Senior executives paid in part in shares, precisely to avoid tax, will be affected. And the biggest investors. In total, this represents around 500,000 households.
These powerful families have relays and will lobby Congress to water down this reform
And thanks to their advisers they will also look for new ways to avoid tax.
Joe Biden is preparing for it.
He wants to allocate an exceptional budget of $ 80 billion to the tax service, to help it collect taxes better.
Basic public services are currently underfunded for lack of sufficient resources.
For ten years, tax income has been gradually cut up by the avalanche of tax gifts.
More than a fifth of the income of the ultra rich is not declared to the tax authorities.
In short
► The profits of Alphabet, the parent company of Google, almost tripled in the first quarter.
It is close to $ 18 billion.
The sharp rise in advertising revenue is driving this phenomenal growth.
For the search engine, they went from 25 to 32 billion dollars in one year.
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United States
Joe biden
Finance
Taxation