Democrats Propose To Partially Abolish Donald Trump’s Tax Reform And Raise Taxes On The Rich And Businesses

Richard Neal, chairman of the House Ways and Means committee, and House Speaker Nancy Pelosi (Reuters)

Democrats on a committee of the US House of Representatives on Monday proposed a tax increase for the richest and for companies that earn more than 5 million dollars a year.

Democrats hope that this tax increase will serve to collect 2.9 trillion dollars over 10 years and pay for the social spending program of US President Joe Biden, valued at 3.5 trillion dollars and that his party wants to approve in Congress before the end of the month.

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That plan has yet to be drafted and various Congressional committees are now looking at exactly what to include in that plan.

In this context, the Democrat, Richard Neal, president of the House Ways and Means committee, revealed on Monday a proposal that would serve to abolish part of the tax reform approved in 2017 by the Republicans in Congress under the government of Donald Trump. (2017-2021).

Specifically, Neal wants to replace the flat rate of 21% that all companies pay in taxes with a gradual structure, so that companies that earn less than $ 400,000 a year pay 18% in taxes, those that have profits of up to 5 million by 21% and those that exceed those 5 million by 26.5%.

That proposal, however, is far from the fixed rate of 28% that US President Joe Biden proposed, and is still lower than the 35% that was in effect before Trump’s tax reform.

Likewise, Neal’s plan would raise the amount of taxes paid by individuals who earn more than $ 400,000 a year from 37% to 39.6%, or 450,000 in the case of married couples.

Progressive Congresswoman Alexandria Ocasio-Cortez appeared at the Met’s lavish gala in New York on Monday wearing a dress and the phrase “Tax the rich” (Getty Images via AFP)

Those numbers are also more far-reaching than Biden’s proposal that wanted to set the tax limit at $ 452,700 a year for individual tax filers and $ 509,300 for married couples.

Neal’s plan has yet to get the support of all Democrats, whose more moderate wing is reluctant to raise taxes for businesses or higher incomes.

However, the gap between the richest and the middle and lower classes in the US has widened during the pandemic and has reached levels not seen in half a century.

In fact, during the first year of the pandemic, American billionaires saw their wealth increase by $ 1.3 trillion, a growth of almost 45%, with some of them multiplying their fortunes by as much as 600%, according to a report by the Institute for Policy Studies (IPS), a Washington-based think tank.

(With information from EFE)

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