On Tuesday, President Biden shared his policy aspirations during the State of the Union address. The commander in chief outlined three taxA tax is a mandatory payment or charge collected by local, state, and national governments from individuals or businesses to cover the costs of general government services, goods, and activities. proposals in his remarks: quadrupling the brand-new excise taxAn excise tax is a tax imposed on a specific good or activity. Excise taxes are commonly levied on cigarettes, alcoholic beverages, soda, gasoline, insurance premiums, amusement activities, and betting, and typically make up a relatively small and volatile portion of state and local and, to a lesser extent, federal tax collections. on stock buybacks, instituting a “billionaire minimum tax,” and extending the now-lapsed expanded Child Tax CreditA tax credit is a provision that reduces a taxpayer’s final tax bill, dollar-for-dollar. A tax credit differs from deductions and exemptions, which reduce taxable income, rather than the taxpayer’s tax bill directly. .
Erica York and Alex Muresianu from the federal tax policy team joined Jesse to give a run-down of Tuesday night’s events. They discuss the prospects of major tax changes becoming law in a divided government and what these proposals signal about how President Biden thinks about tax policy as he enters the latter half of his first term.