Biden wants to entirely pay for trillions in new spending by raising taxes on corporations and the wealthy

President Joe Biden AP Photo/Evan Vucci, File
  • President Joe Biden will propose new taxes on corporations and the wealthy to pay for his agenda, Axios reported.
  • The taxes are intended to cover more than $4 trillion in new spending on infrastructure and health care.
  • Biden is standing by a pledge not to raise taxes on anyone making less than $400,000.
  • See more stories on Insider’s business page.

The White House’s ambitious plans for more than $4 trillion in new spending on infrastructure, health care, and education will be completely paid for by new taxes on corporations and wealthy investors, President Joe Biden will announce Wednesday, Axios reported.

The elements of the plan include nearly doubling the capital gains tax to 39.6% for investors who earn more than $1 million. Biden also wants to increase the marginal income tax rate for the country’s wealthiest taxpayers from 37% to 39.6%.

According to Axios, the Biden administration will argue these tax increases are sufficient to cover the full cost of the president’s agenda, although that will require collecting revenue from the next 15 years to cover eight years of spending.

Making the president’s spending plans deficit-neutral is seen as key to assuaging concerns among moderate Democrats, particularly in the Senate. Centrists like Sen. Joe Manchin of West Virginia, an influential Democrat, say they can only support significant infrastructure spending as long as it is paid for.

The federal deficit topped $3 trillion last year after Congress approved emergency spending programs to combat the pandemic and assist struggling families. Biden approved a $1.9 trillion stimulus law in a party-line vote last month.

Biden will outline his tax plan in an address to Congress, beginning at 9 p.m. EDT on Wednesday.

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