Biden’s Criminally Fuzzy Tax Math
At one point during his State of the Union speech, President Joe Biden ranted about how billionaires don’t pay enough in taxes and asked the public to envision all the great things that we could do if the super-rich “paid their fair share.”
In doing so, he took lying with statistics to a new, otherworldly level.
Here’s what Biden said:
THE PRESIDENT: You know, there are 1,000 billionaires in America. You know what the average federal tax is for those billionaires?
AUDIENCE MEMBER: Zero!
THE PRESIDENT: No.
They’re making great sacrifices — 8.2%.
AUDIENCE: Booo —
THE PRESIDENT: That’s far less than the vast majority of Americans pay.
No billionaire should pay a lower federal tax rate than a teacher, a sanitation worker, or a nurse.
I proposed a minimum tax for billionaires of 25%— just 25%. You know what that would raise? That would raise $500 billion over the next 10 years.
And imagine what that could do for America. Imagine a future with affordable childcare, millions of families can get what they need to go to work to help grow the economy.
Imagine a future with paid leave, because no one should have to choose between working and taking care of their sick family member.
Imagine — imagine a future with home care and eldercare, and people living with disabilities so they can stay in their homes and family caregivers can finally get the pay they deserve.
All Biden has is imagination — and no facts to back it up — when it comes to this issue.
First, consider his claim that the tax rate paid by billionaires is 8.2%. That plays well with soak-the-rich leftists. But where did he get this number?
Not from the IRS. It calculates the actual tax rate that various income groups pay, including the ultra-rich. Its data show that the 400 people with the biggest incomes in America were paying an average tax rate of more than 23%. Congress’ Joint Committee on Taxation figures that the tax rate on the top 0.4% of families is 26%.
So where does Biden come up with an 8.2% tax rate? He changes the definition of taxable income to include all unrealized gains from investments.
If you have money in the stock market, any gains in the value of those stocks would count as income to Biden, even if you don’t sell the stock. Presumably so would any gains in the value of your home. Or the value of any other assets you possess.
By artificially inflating income, Biden can make their tax burden seem tiny.
The idea of taxing unrealized gains — in other words, extending the income tax to things that aren’t income — could very well be unconstitutional in addition to being economically reckless.
The Supreme Court heard a case in December involving a couple who had to pay taxes on offshore investments for which they received no dividends or distributions. If they side with the plaintiffs, it would put an end to the left’s “tax the wealth” schemes.
What about his claim that taxing the wealth — not the income — of billionaires would raise $500 billion?
Sounds like a lot, doesn’t it? Except Biden is hoping nobody notices the caveat — that it’s $500 billion over 10 years. In other words, $50 billion a year.
Even that might sound like a lot … until you put it in context.
That $50 billion wouldn’t even cover one month’s worth of interest payments on the national debt, which was $69.2 billion in January.
It wouldn’t even pay half of the increase in the deficit in the first five months of this year compared with last year. (The deficit from October through February was $830 billion, which is up $108 billion from the same months the year before.)
The idea that an extra $50 billion could finance a new childcare entitlement, paid leave, and home care isn’t just ludicrous, it’s insane.
We don’t expect Biden to know or understand what he’s reading on the teleprompter, but shame on anyone else for believing the lies he’s spewing.
— Written by the I&I Editorial Board
https://issuesinsights.com/2024/03/11/bidens-criminally-fuzzy-tax-math/
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