Biden to Propose New 20% Minimum Billionaire Tax

• A 20% minimum tax rate would be imposed on U.S. households with a net worth over $100 million under the "Billionaire Minimum Income Tax" proposal.
• More than half of the revenue could come from companies valued at over $1 billion.

According to a CNBC source, President Biden is predicted to present a new minimum tax in his 2023 budget, which will primarily affect billionaires.

The "Billionaire Minimum Income Tax" would impose a 20% minimum tax rate on U.S. households with a net worth over $100 million, with over half of the revenue generated from those worth over $1 billion.

The document stated that the minimum tax would ensure that teachers and firefighters are not taxed at a lower rate than the wealthiest Americans.

The document predicts that the proposed levy will decrease the deficit by approximately $360 billion in the upcoming decade.

If a wealthy household is already paying 20% of their income in taxes, they will not be required to pay any additional taxes under the proposal. However, if they pay less than 20%, they will need to make a "top-up payment" to meet the new minimum tax rate.

The new minimum tax will prevent ultra-high-net-worth households from avoiding taxes on their unrealized income for an extended period.

Biden's 2023 budget, which includes a new tax proposal, is expected to be released on Monday. The fact sheet released from the White House on Saturday shows that his spending plan aims to trim $1.3 trillion from the deficit over the next decade.

Whether Congress will advance Biden's proposal on a billionaires' tax remains to be seen. Last year, Senate Democrats proposed a tax on the unrealized capital gains of the wealthiest Americans, but the measure did not progress.

The federal deficit in fiscal year 2021 was approximately $2.44 trillion, a decrease of around $360 billion from the previous year, as per the Congressional Budget Office.

The American Rescue Plan, which was designed to aid struggling Americans during the Covid crisis, has contributed to the swift economic recovery, resulting in a lower deficit.

The government is projected to collect more than $300 billion in additional revenues compared to last year due to a stronger economy, which means less economic and pandemic support will be needed for people and businesses.