On Monday, President Joe Biden presented a $5.8 trillion budget proposal to reduce the country’s deficit over the next decade with tax increases targeting the wealthy. Congress has until October 1 to approve this budget, which faces opposition from various lawmakers.
This is the second budget request made by President Biden since taking office in January 2021. The White House has not deviated too much from last year’s budget concerning this proposal; however, the 4% increase in military spending is one change that stands out.
In a statement that accompanied the budget proposal, President Biden explained that his plan sends a clear message that exalts values appreciated by all Americans: security, social programs, and “fiscal responsibility.”
According to CBS News, one of the funding mechanisms of this budget plan is the proposed Billionaire Minimum Income Tax, which would force individuals with a net worth of $100 million or more to pay a strict 20% of their income and stock holdings without the benefit of deductions.
White House Budget Director Shalanda Young explained that this provision would ensure that wealthy Americans do not get away with enjoying income tax rates lower than those faced by firefighters, teachers, and nurses.
The first rejection of the budget proposal came a few hours after its presentation.
Senator Mitch McConnell of Kentucky, who leads the Republican Party in the Senate, described the proposal as inadequate in the face of Russia’s ongoing threat and the military ambitions of President Vladimir Putin in Ukraine.
Senator Richard Shelby (R-Alaska) agreed, stating that Biden has “again proposed a fiscal blueprint that overspends on wasteful domestic programs and fails to adequately provide for our nation’s defense.”
The plan in Biden’s budget is to increase national security funding to $813 billion, which is 4.6% more than his proposal last year. But Republicans argue that inflation will overshadow the amount and will need to substantially increase before the two parties can fund the government beyond September.
Should the tax measure be approved by Congress, it would reduce the federal deficit by about $1 trillion by 2030 if spending does not continue to increase.