The following is a statement from Amy Hanauer, Executive Director of the Institute on Taxation and Economic Policy, regarding the adoption of the Build Back Better plan by the House of Representatives.
“The Build Back Better plan that the House adopted today will transform the country and make our tax code more progressive, fairer and better able to fund critical priorities.”
âThe plan increases the incomes of the rich and businesses to pay for the investments the country needs. It offers tax credits to middle and low income families that increase income and significantly reduce poverty. Together, these elements create a much better tax system.
âThe tax increases in this plan will allow America to support our families and communities in a way that will pay off for decades to come. The bill includes much needed funding for child care, pre-kindergarten, paid family leave, health care and climate infrastructure. These investments will make it possible to better prepare the country for the challenges of the future. Refundable tax credits correct historic inequalities, giving the full child tax credit to more children of all races and in particular to black, Hispanic, Indigenous and immigrant children who had been so excluded. disproportionate.
âCritical provisions of the revenue bill include a 15% minimum corporate tax, reform of international corporate taxation, a surtax on multimillionaires and billionaires, closing a loophole that has allowed some wealthy people avoid paying for health care and increased funding from the Internal Revenue Service which will allow better tax enforcement on the very wealthy and on businesses. These essential reforms are starting to correct tax code problems such as corporate tax evasion and low rates for the very rich.
“The Senate should improve the bill by rejecting the provision that raises the cap on state and local tax deductions to $ 80,000 and replacing it with a Better Compromise that lifts the cap only for those earning less than $ 400,000 ( with a phased introduction for winnings between $ 400,000 and $ 500,000). Other positive reforms of President Biden’s original proposal have been removed from this version and are expected to be continued, either in the Senate version or in subsequent legislation. This includes the equalization of taxes on income from work and capital, the increase in maximum rates and the taxation of unrealized capital gains. Congress should also continue to push for tax fairness and closing loopholes in future legislation. But today was a huge step forward for the country.
âWith the Build Back Better plan, the wealthiest Americans and the most profitable businesses will pay more, while low- and middle-income families will be helped to pay for the essentials. These are powerful changes in the right direction for the US tax code.