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President’s Proposed Budget Targets Breaks That Favor Wealthy and Companies

S.J. Steinhardt
Published Date:
Mar 10, 2023

GettyImages-884618936 White House Washington DC President Federal

President Joe Biden’s proposed $6.8 trillion budget for fiscal year 2024 contains an end to tax breaks for private equity fund managers, oil and pharmaceutical companies, and investors in crypto and real estate, Accounting Today reported.

In unveiling his budget earlier this week in Philadelphia, the president vowed to cut “wasteful spending by getting rid of special tax breaks for Big Oil companies, who made $200 billion in profits last year in the midst of a worldwide recession.” The budget “proposes additional reforms that would ensure the wealthy and corporations pay their fair share while cutting wasteful spending on Big Pharma, Big Oil, and other special interests,” according to a summary provided by the White House.   

Accounting Today noted that the Republican-controlled House will block all these changes. But it added that the administration's proposal offers a glimpse of the issues that Biden will likely place prominently in his economic platform if he decides to run for a second term in 2024.

His proposals include the following:

● A 25 percent minimum tax on the wealthiest 0.01 percent of Americans;

● Raising the corporate tax rate to 28 percent, still significant below the 35 percent rate that existed prior to the 2017 Tax Cuts and Job Retention Act (TCJA);

● Ending tax rates for offshoring by raising the tax rate on U.S. multinationals’ foreign earnings from 10.5 percent to 21 percent; and

● Restoring the top tax rate of 39.6 percent for single filers making more than $400,000 a year and married couples making more than $450,000 per year; taxing capital gains at the same rate as wage income for those with more than $1 million in income; and closing the carried interest loophole “that allows some wealthy investment fund managers to pay tax at lower rates than their secretaries.”

The budget would also eliminate a section of the tax code that allows real estate investors to defer capital gains taxes when investing in properties of equal or greater value, and a break that allows crypto investors to sell their assets at a loss to lower their tax liability—a strategy known as crypto tax-loss harvesting.

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