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Former Vice President Joe Biden has positioned himself as a “moderate” in the Democratic nomination race, but his tax plan would raise taxes by $4 trillion over a 10-year period, according to an analysis by the liberal Urban-Brookings Tax Policy Center.
The TPC concluded that under Biden’s plan, all income groups would pay higher taxes while businesses and individuals making over $400,000 per year would be the hardest hit. The think tank also noted that non-high earners could also see their taxes go up due to corporate tax increase.
The proposal is ‘very progressive’
While Biden has branded himself as a centrist alternative to democratic socialist Sen. Bernie Sanders, the analysts who studied his tax policies concluded would increase taxes to levels higher than former President Barack Obama and 2016 Democratic presidential candidate Hillary Clinton proposed.
“The proposal is very progressive,” said Gordon Mermin, TPC senior research associate.
Should Biden’s plan go into effect, people with income between $52,000 and $93,000 would see their taxes go up by about $260. Individuals with lower incomes would owe only about $30 more, according to Fox Business. Top earners would experience an average tax increase of nearly $300,000, or 17% of their after-tax income, beginning in 2021.
Biden’s plan also calls for raising the corporate tax rate from the current 21% to a new rate of 28%, which is significantly higher than the European average of 22.5%. Also, according to The Hill, Biden’s plan would “impose a new 15% minimum tax on the income companies report on their financial statements.” He also proposes doubling the minimum tax on corporate foreign earnings from 10.5% to 21%.
Much bigger tax increases than Hillary Clinton proposed
The Hill also reported that TPC estimates Biden’s tax increases would be “significantly higher” than its estimates for Hillary Clinton’s 2016 proposals. That year, TPC estimated that Clinton’s plan would raise $1.4 trillion over 10 years, or 0.5% of GDP. Meanwhile, Biden’s plan would raise $4 trillion over a decade, or 1.5% of GDP, or nearly three times higher.