A new study found Democrats’ $1.75 trillion social spending bill will enhance the wealth gap in the United States. Based on the proposed tax map, rich people are likely to get bigger benefits, compared to the middle class.
Democrats Will Tax the Middle and Lower Class
Brookings Institution’s Project, the liberal-leaning Tax Policy Center, issued a report which suggested lower and middle-class households will pay 30% more in taxes starting next year if the social spending bill is passed.
Although Democrats are eyeing small taxes initially, they will surge it massively over time until the end of the decade.
Likewise, the report found Democrats are raising the cap on the State and Local Tax (SALT) deduction from $10,000 to $80,000; this will benefit two-thirds of millionaires in evading high taxes.
Using SALT deduction benefits, taxpayers can leverage up to $10,000 on their local and state taxes. However, the proposed increase in this cap will raise this limit to $80,000 per year, which will ultimately help richer people evade more taxes.
Although this SALT proposal is present in the existing text of the Build Back Better agenda, socialist Senator Bernie Sanders proposed to keep the limit of $10,000 for riches, while removing the cap altogether for the middle class and lower-income people.
Democrats are working on a series of compromises aimed at loosening the restrictions on the state and local tax deduction, or SALT deduction, though some wanted to eliminate the cap entirely, Bloomberg reports. https://t.co/mC7BuMZXju
— Newsmax (@newsmax) November 12, 2021
The report indicates an average millionaire will save almost $16,800 in annual taxes from benefits given under the new SALT cap.
Biden Breaking His Promise to Not Tax People Earning Below $400,000
Biden has often pledged not to increase taxes on people or businesses earning below $400,000 per year. However, the new report is busting this claim of the president who continues robbing people’s hard-earned money to support socialism in the country.
House Democrats proposed to double the tobacco tax to almost $2 per pack, not to mention the 15% corporate tax. Similarly, the proposals of imposing a Global Minimum Tax, 1% buyback on companies, and a 5% wealth tax on people having gross income over $10 million are also underway to help the administration fund Biden’s envisioned bill.
Despite all of these new taxes on riches, the report found wealthy individuals making above $10 million will have a net tax cut at the expense of middle-class people. This will ultimately increase the wealth gap.
#BuildBackBetter could cut taxes for 65% of millionaires: analysis https://t.co/DbGNfi8I14
— Freedom Caucuser (@charlie31200514) November 12, 2021
The director of the tax policy studies at CATO Institute, Chris Edwards, said Democrats are increasing the complexity of America’s tax code. This will ultimately help people avoid taxes as much as possible.
Democrats are likely to bring the bill before Congress soon, as their infighting is still not over. Right now, the only roadblock is Sen. Joe Manchin raising his concerns the passing of this bill will increase inflation.
However, President Biden has often touted the social spending bill as the key to controlling the persisting inflation across America.