It is frequently said that America doesn’t have a revenue problem; it has a spending problem. For President Joe Biden, though, it’s the other way around. If he has his way, he will make certain the top tax rate that Americans pay on personal income is unmatched anywhere in the developed world. It’s the Biden version of “America first.”
The president’s $1.75 trillion Build Back Better Act, currently undergoing the sausage-making process in the Democrat-controlled Congress, would explode the average combined federal and state tax rate on high earners’ personal income from its current rate of 49.2%, a middling rank among nations of the Organization for Economic Co-operation and Development (OECD). The new rate would surge past that of the current OECD leader, Japan, hitting a record of 57.4% in 2026, according to the Tax Foundation,
Under the president’s plan, the new combined top tax rate would break the 50% mark in every U.S. state. Some of the bluest states would be hit the hardest: New York, 66.2%; California, 64.7%; New Jersey, 63.3%. Even red, red Texas and Wyoming would end up with a top rate of 51.4%. It wouldn’t be much of a slip of the tongue to call this bill the “Build Tax Better Act.”
Mr. Biden and his tax-happy allies are shooting the moon just as the Treasury Department boasts a monthly revenue record: $283.9 billion in October, the first month of the new fiscal year. Unfortunately, while the federal government raked in a king’s treasure, it spent much more — a near-record $449 billion.
Americans who care little about the tax travails of the wealthy may wince upon learning the president’s assurance that he would not raise taxes on those earning less than $400,000 is not entirely accurate. “Taking into account all major tax provisions, roughly 20% to 30% of middle-income households would pay more in taxes in 2022,” reads an analysis by the Tax Policy Center. The increase, gauged at less than $100, would not break the bank. Other burdensome expenses might.
Biden management of the U.S. economy has caused inflation to explode, with the October Consumer Price Index jumping 6.2% above a year ago, the largest gain in 31 years. With gasoline prices up 60% and food bills 5.3% higher, Americans can credit the president for the inflationary spiral. Such are the consequences of choking off the nation’s abundant supply of fossil fuels and pumping trillions of excess dollars into the economy.
If given a choice, few Americans would trade their agreeable 21st-century existence for a commoner’s life during the Middle Ages. By comparison, though, medieval serfs were required to hand over only a third of their income to their lord and slaves no more than half. If the Biden “Build Tax Better” bill becomes law, “America first” will take on a new and dismal meaning.