The Biden administration has announced a number of tax proposals to fund new government investments such as infrastructure, education and family programs as part of the Build Back Better (Building a Better America) agenda. From analyzing the Build Back Better Act and Inflation Reduction Act to the U.S. Treasury’s international tax proposals, Tax Foundation experts continue to serve as trusted thought leaders, providing research, modeling, analysis, and commentary on how the Biden tax plan would impact U.S. competitiveness, economic growth, government revenue, and everyday taxpayers. The posts below include our research and analysis on a variety of Biden tax proposals. You can also explore our economic modeling via Options for Reforming America’s Tax Code and our 10 Tax Reforms for Growth and Opportunity. See the latest proposals from 2024 presidential candidates, including Vice President Kamala Harris and former President Trump, with our 2024 tax tracker
Inflation Reduction Act CHIPS and Science Act Global Tax Deal
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President Biden is proposing extraordinarily large tax hikes on businesses and the top 1 percent of earners that would put the US in a distinctly uncompetitive international position and threaten the health of the US economy.
19 min read
Tax policy has become a significant focus of the U.S. 2024 presidential election. Our new interactive tool helps keep track of the tax policies proposed by presidential candidates during their campaigns.
Congress should reconsider key elements of the IRA, including the book minimum tax and the green energy credits, with an eye towards simplification and fiscal responsibility.
46 min read
Instead of such a complex and inefficient system, policymakers should move to full expensing as part of the effort to build.
3 min read
The Inflation Reduction Act increases the IRS’s budget by roughly $80 billion over 10 years. The money is broken into four main categories—enforcement, operations support, business system modernization, and taxpayer services—as well as a few other small items such as an exploratory study on the potential of a free-file system.
6 min read
In dollar terms, the industries that would account for the largest book minimum tax liabilities are manufacturing, at $73.2 billion, followed by finance, insurance, and management at $46.9 billion.
6 min read
Under President Biden’s tax plan, the United States would tax corporate income at the highest top rate in the industrialized world, averaging 65.1 percent.
3 min read
As President Biden’s tax plans are considered in Congress, the future of the $10,000 cap for state and local tax deductions (SALT) is becoming an important part of the tax debate.
3 min read
There’s a useful contrast between two revenue options related to President Biden’s infrastructure push. The president’s American Jobs Plan includes a proposal to raise the corporate tax rate to 28 percent. Meanwhile, historically, the gas tax is the main revenue source for transportation funding.
8 min read
In his first 100 days as president, Joe Biden has proposed more than a dozen significant changes to the U.S. tax code that would raise upwards of $3 trillion in revenue and reduce incentives to invest, save, and work in the United States.
4 min read
The international corporate tax changes in President Biden’s tax plan would increase tax rates on domestic income more than on foreign income, resulting in a net increase in profit shifting out of the US, according to our Multinational Tax Model.
33 min read
The Biden administration is proposing to tax long-term capital gains at ordinary income rates for high earners, which will bring the top federal rate to highs not seen since the 1920s.
2 min read
The top federal rate on capital gains would be 43.4 percent under Biden’s tax plan (when including the net investment income tax). Rates would be even higher in many U.S. states due to state and local capital gains taxes, leading to a combined average rate of over 48 percent compared to about 29 percent under current law.
3 min read
The Biden administration has argued for raising the corporate tax rate to offset the drop in federal corporate revenues following the Tax Cuts and Jobs Act (TCJA) of 2017, claiming it did not lead to more corporate investment as advertised. Although corporate revenues did drop following this tax reform, the ensuing increase in corporate investment far exceeds these revenue losses.
1 min read
The Options guide presents the economic effects we estimate would occur in the long term, or 20 to 30 years from now, but we can also use our model to show the cumulative effects of the policy change—providing more context, for instance, about how the effects of a higher corporate income tax rate compound over time, which we estimate would reduce GDP by a cumulative $720 billion over the next 10 years.
4 min read
New international tax rules on super-profits would disproportionately impact U.S. companies however they are designed. The question that Treasury should answer is why limit the policy in such a way that magnifies that disproportionate application and the risk to the U.S. tax base.
6 min read
The corporate tax base should be reformed directly, rather than piecemeal through a complicated and burdensome separate tax applicable to a small number of companies.
5 min read
No other country has tried to enforce some of the policies that the Biden administration is proposing. Embarking on such uncharted course would set the U.S. apart from global tax policy norms and best practices and could harm American competitiveness.
4 min read
Newly implemented county and regional taxes yield state and local top marginal tax rates in excess of 26 percent for many Portland small businesses, and if all of President Biden’s tax proposals were adopted, those owners could face all-in marginal rates of more than 80 percent, far and away the highest in the country going back decades.
5 min read
Whether we use corporate tax collections as a portion of GDP, average effective tax rates, or marginal tax rates, each measure shows that the U.S. effective corporate tax burden is close to or above the average compared to its OECD peers. Raising corporate income taxes would put the U.S. at a competitive disadvantage, whether one looks at statutory tax rates or effective corporate tax rates.
4 min read
While the focus has been on the federal rate, it is important to include state tax rates when thinking about the total tax burden on corporate income.
3 min read
An increase in the federal corporate tax rate to 28 percent would raise the U.S. federal-state combined tax rate to 32.34 percent, higher than every country in the OECD, the G7, and all our major trade partners and competitors including China.
6 min read
The economics is clear: If Biden wants to maximize the economic benefits of his $3 trillion in new infrastructure spending, he should cut $3 trillion in other government spending to pay for it.
7 min read
The major tax-related benefits in the $1.9 trillion economic relief plan are a third round of direct payments, extended unemployment insurance (UI) benefits and a $10,200 unemployment insurance income exemption for 2020, and an expansion of the Child Tax Credit.
6 min read
The Biden administration has signaled its openness to raising the corporate tax rate, potentially by phasing in an increase over several years. While phasing in a tax increase, as opposed to hiking immediately, may seem like a reasonable middle ground, it would be the worst of both worlds because it provides old investment with a lower rate while penalizing new investment.
2 min read