Biden economic advisor unveils 'key principles' for tax policy plan ahead of expiring Trump tax cuts
President Joe Biden's top economic advisor unveiled plans to address the battle over trillions in expiring tax breaks enacted by former President Donald Trump
President Joe Biden's top economic advisor on Thursday unveiled plans to address trillions in expiring tax breaks enacted by former President Donald Trump.
After 2025, several provisions from the Tax Cuts and Jobs Act, or TCJA, of 2017 will expire without action from Congress, which could increase taxes for more than 60% of filers, according to the Tax Foundation.
Some expiring individual provisions include lower federal income tax brackets, a higher standard deduction, a more generous child tax credit and doubled estate and gift tax exemption, among others.
"President Biden plans to extend tax cuts for hardworking Americans by making sure the wealthiest and big corporations pay their fair share," White House national economic advisor Lael Brainard told reporters Wednesday evening during a press call.
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Biden will follow "key principles" to support middle-class and working families as the 2025 tax cliff approaches, Brainard said.
While expiring TCJA provisions could affect all Americans, she reaffirmed Biden's pledge to only extend tax breaks for those making less than $400,000. By comparison, former President Donald Trump has said he plans to extend all expiring TCJA provisions.
Aiming to raise revenue for his "commitment to seniors and fiscal responsibility," Biden would allow TCJA provisions to expire for those making more than $400,000, Brainard said.
Fully extending TCJA provisions could add an estimated $4.6 trillion to the deficit over the next decade, according to the Congressional Budget Office.
Trump hasn't released specific plans on how to fund expiring TCJA provisions, but has voiced support for tariffs, which are taxes levied on imported goods from another country.
In a statement, Trump campaign National Press Secretary Karoline Leavitt said Trump was proud to have passed the TCJA and if reelected would "advocate for more tax cuts for all Americans."
While the TCJA permanently reduced the top federal corporate tax rate from 35% to 21%, Biden aims to raise corporate taxes and implement a global minimum tax, according to Brainard.
The plan also called for sustained IRS funding, which has been targeted by Republicans since Congress approved $80 billion in funding via the Inflation Reduction Act.
This story originally appeared on: CNBC - Author:Kate Dore, CFP®
