As a seasoned tax attorney, I’ve been closely following the fiscal policies of President Biden and former President Trump. A recent editorial from the Akron Beacon Journal provides a comprehensive comparison of their tax plans, which I believe warrants further discussion.
President Biden’s fiscal 2025 tax and spending blueprint is essentially a political statement, advocating for increased taxes on the wealthy and businesses to fund federal support for child care, health care, and housing. Despite the slim chances of enactment, it serves as a stark contrast to the tax policies of GOP nominee Donald Trump.
The article suggests that Biden’s tax plan would be fairer and more fiscally responsible than Trump’s. However, it also points out that the country needs a reckoning on its unsustainable budgetary path, and Biden’s proposals, while better than the alternative, do not envisage one.
The tax cuts implemented by a Republican Congress and Trump in late 2017 are set to expire at the end of 2025. This impending deadline will force the next administration to prevent a sudden reversion to pre-2018 law, which would lead to mixed results in terms of equity and efficiency.
Trump favors extending the entire law, estimated to cost $3.3 trillion over the next decade, with no realistic plan to pay for it. Biden, on the other hand, proposes raising taxes on wealthier Americans and corporations, including a hike in the corporate rate to 28% from the current 21%. These changes would raise about $5 trillion.
While Biden’s approach of raising revenue from those best able to pay is commendable, his insistence on not raising taxes on individuals earning under $400,000 a year is questionable. This exempts all but 1 or 2% of taxpayers, including the entire upper middle class, from any new responsibility for helping the government pay its bills.
Despite its shortcomings, Biden’s budget would shave about $3 trillion off the deficit over the next decade. However, the deficit is still set to grow $16 trillion in that time frame. Both Biden and Trump are committed to the unrealistic promise of leaving Social Security and Medicare untouched.
As we approach the next election, it’s crucial for voters to consider the actual economic policy each candidate supports. On taxes, Biden seems to have the better, if far from ideal, approach. As responsible financial citizens, we must stay informed and make decisions that contribute to the well-being of our communities.