KEY POINTS

  • Top income earners would face higher taxes while the rest would get relief under a plan proposed by Democratic presidential nominee Joe Biden.
  • Lower taxes enshrined in the Tax Cuts and Jobs Act of 2017 would be rolled back, increasing the tax bill on those making more than $400,000 per year.
  • A critique suggests the increase in the corporate tax rate, from 21% to 28%, would trickle down in the form of a decrease in after-tax earnings for the middle class.

Top earners would pay more taxes, while the rest would get relief under a plan proposed by Democratic presidential nominee Joe Biden, a Tax Policy Center report released Thursday found.

Parts of his plan, the review found, would undo the cuts introduced in President Donald Trump’s first term in office. Lower taxes enshrined in the Tax Cuts and Jobs Act of 2017 would be rolled back, increasing the bill on those making more than $400,000 per year. No taxpayer making less than that will see taxes rise, the analysis concluded.

Other parts of the proposal would expand aid to post-secondary students, forgive some student loan debt and increase subsidies under the Affordable Care Act, known otherwise as Obamacare.

The critique suggests the increase in the corporate tax rate, from 21% to 28%, would trickle down in the form of a decrease in after-tax earnings for the middle class. Republicans, meanwhile, contend that 82% of U.S. taxpayers would wind up paying more in taxes under the Biden plan.

An op-ed  written by Michael Strain at the conservative American Enterprise Institute and published by Bloomberg argues Biden’s hoped-for economic boost would face an uphill battle because of the pandemic.

“If elected, a Biden White House would only have so much political capital,” he argued. “Tax increases would slow growth or leave it relatively unchanged.”

The not-so-rich would indeed see their taxes go up eventually because some cuts, like a child tax credit, would be temporary. And due to revisions since March, the boost for federal revenue is far below the $4 trillion estimate from earlier this year, which in part prompted the TPC’s review.

The report added it’s unlikely that Biden’s tax plan, if he’s elected, would take effect before January 2022.

“This delay reflects the uncertain legislative environment caused by the ongoing COVID-19 pandemic and related economic disruptions,” the report read.