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A breakdown of the budget

Although some are slamming Biden’s request for increased spending on social programs, it also arrives at a time when middle-class America is being squeezed by ongoing inflation.

The White House says the budget will lower taxes for middle and low-income Americans by $765 billion over a decade. There are new proposed tax breaks for low- and middle-income Americans, like credits for first-time homebuyers and expanded assistance for people to buy health insurance.

The president wants to restore $80 billion in IRS funding, strengthen the finances of Medicare and Social Security, lower prescription drug prices and establish a national paid family and medical leave program, among other things.

However, the proposal also calls for $850 billion for the Defense Department and reiterates previous requests for continued aid to Ukraine and Israel and $11.8 billion in increased border security.

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Some experts are also scrutinizing how exactly these programs will be paid for.

Chris Edwards of the libertarian thinktank Cato Institute estimated that the budget would add $17 trillion to government debt over the coming decade. "The Biden budget promises 'meaningful deficit reduction through measures that reduce wasteful spending' but does not deliver," he wrote.

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'Pay your fair share'

The White House says its proposals would be paid for in part by raising taxes on high-income Americans and corporations.

“I’m not anti-corporation,” Biden said, while speaking to New Hampshire. “I’m a capitalist, man. Make all the money you want. Just begin to pay your fair share in taxes.”

The corporate tax rate would be hiked to 28%, up from the 21% rate set by the 2017 Tax Cuts and Jobs Act during the Trump administration.

Folks earning more than $400,000 and married couples earning more than $450,00 a year would see the highest individual income tax rate reinstated to 39.6%. And individuals with wealth of over $100 million would be required to pay at least a quarter of their income to Uncle Sam.

The Biden administration also wants to deny tax deductions for employee compensation above $1 million, quadruple the stock buybacks tax to 4%, eliminate certain tax subsidies and crack down on tax avoidance by the wealthy and big corporations.

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Serah Louis is a reporter with Moneywise.com. She enjoys tackling topical personal finance issues for young people and women and covering the latest in financial news.


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