State Of The Union Talking Points On Tax Fairness

March 5, 2024

President Biden is calling on Congress to pass a Billionaire Minimum Income Tax to end the scandal of billionaires and other super-wealthy individuals paying a lower tax rate than teachers, nurses and firefighters—and sometimes paying nothing at all. It’s time to reward work, not wealth.

  • As of the end of last year, the wealth of billionaires had grown $2.4 trillion, or 83%, richer in the six years since the Trump-GOP tax cuts were enacted. But because of a big tax loophole, many of them have paid little if any federal income taxes on those investment gains. Meanwhile, working families pay taxes in every paycheck.
  • The top 400 billionaires pay an average federal income tax rate of just 8% when the growth in the value of their stock holdings is included in their income. That’s little more than half the 13.6% average income tax rate that all taxpayers pay.  
  • Biden’s Billionaire Minimum Income Tax will raise $437 billion over ten years. That’s enough money to offer free preschool to 6 million 3- and 4-year-olds AND lower the cost to families of homecare for seniors while raising caregiver pay. 
  • Biden’s billionaires tax will impose a 25% minimum tax on households worth over $100 million. It will include in the measurement of taxable income the growth in a rich person’s assets like stock, bonds and real estate—a type of income that is sometimes never taxed.  
  • About three-quarters of voters support the Billionaire Minimum Income Tax proposed by President Biden, including majorities of Republicans.

President Biden will energetically oppose Republican efforts to cut Social Security and other programs to pay for tax cuts for billionaires and big corporations.  

  • The GOP likes to  complain about deficits, but it’s reckless Republican tax cuts—which mostly benefit the rich—that created the majority of government debt this century. In fact, the Bush and Trump tax cuts have added $10 trillion to the debt since their enactment and are responsible for 57% of the increase in the debt ratio since 2001.
  • Nevertheless, Congressional Republicans want to set up a “debt commission” with a mandate to consider cuts to Social Security and other vital services for working families, while being highly unlikely to propose raising taxes on the rich or corporations. 
  • Proposed higher taxes on the rich and corporations are unlikely to emerge from a GOP-sponsored debt commission because even as Republicans are trying to set up their commission they’re also trying to cut taxes further for the wealthy.
  • President Biden and Democrats vigorously oppose any debt commission that’s rigged beforehand to cut Social Security benefits and other key programs to pay for tax cuts for the rich and corporations.

President Biden will continue his already effective efforts to force greedy corporations to pay more in taxes to support the nation that helps make their success possible.

    • Biden’s Corporate Alternative Minimum Tax (CAMT) will raise over $200 billion in revenue over the next decade exclusively from the 80 or so richest corporations in America. That’s money that can be used to lower costs and improve the quality of vital services for working families, such as healthcare, childcare, education and housing. 
    • But too many big corporations are still able to use loopholes and special breaks to pay little or nothing in federal income taxes. 
    • A recent study found that 23 big profitable corporations—including Office Depot, T-Mobile and Duke Energy—paid zero taxes or less (meaning they got refunds) over the first five years of the 2017 Trump-GOP tax law, which cut corporate taxes dramatically. 
    • A total of 55—including FedEx, T-Mobile, General Motors and Nike—paid less than 5% in taxes on over half a trillion dollars in combined profits. 
  • Even as they’re paying little in taxes, corporations are extracting more from working households through “greedflation”: the continued elevation of consumer prices after wholesale prices have gone down. 
  • Greedflation and tax dodging have both contributed to the record profits enjoyed in recent years by big corporations and their wealthy shareholders.
  • President Biden wants to raise the corporate income-tax rate and close loopholes that encourage U.S. firms to shift profits and ship jobs offshore.

President Biden will stand firm against Republican efforts to extend the Trump tax cuts for households making over $400,000 a year. Extension of all the cuts, including for the wealthy, would hike the
national debt by nearly $4 trillion

  • Donald Trump and Congressional Republicans enacted a reckless group of tax cuts in 2017 that mostly benefited the wealthy and corporations.
  • This Trump-GOP tax law is expected to have added nearly $2 trillion to government debt by the end of 2025. 
  • In order to hide the true cost of their plan from Congressional scorekeepers, Republicans made most of the individual tax provisions of their law temporary. Most of those temporary provisions expire at the end of 2025. 
  • Republicans want to permanently extend all their reckless, expensive tax cuts. That  will balloon deficits, which the GOP will then use as an excuse to cut Social Security, Medicare and other public services working families need and deserve. 
  • President Biden will oppose extending tax cuts for those making over $400,000 a year, while ensuring taxes do not increase on those making less than that. 

President Biden will defend the restored IRS funding he and Congressional Democrats achieved two years ago to pay for improved taxpayer services and a crackdown on rich and corporate tax cheats.