— Internet News

Biden’s Plan: Raise Taxes On The Rich, Spend It On Education

President Joe Biden will propose spending $1.8 trillion over the next decade to make massive investments in the nation’s education system and to expand and protect tax credits aimed at the middle class, administration officials said Tuesday night, adding that he would pay for the ambitious agenda with some tax hikes aimed at the wealthiest Americans. In a prime-time speech to Congress on Wednesday, Biden is expected to lay out his proposal, dubbed the American Families Plan.

It faces an uncertain political path forward. While an earlier legislative package from the administration, which focused heavily on infrastructure projects, could attract some support from Republicans, it’s likely this plan ― which is targeted at traditional Democratic priorities such as education and the social safety net ― will rely on the party’s narrow majorities in Congress to stay united.

The plan’s centerpiece is a massive investment in the nation’s education system, including universal, free pre-kindergarten education for all 3- and 4-year-olds and free community college for all Americans. The $200 billion pre-K plan calls for a state-federal partnership that the administration says would save the average family $13,000 annually. Spending $109 billion to make community colleges tuition-free would allow 5.5 million students to attend at no cost.

Biden is also proposing increasing the maximum Pell Grant, which helps low-income students attend college, by $1,400, to nearly $8,000, and making two years at historically Black colleges and universities and other institutions focused on educating racial minorities free for students from families making less than $125,000 a year.

The most immediately controversial element of Biden’s plan maybe its tax increases on the wealthiest Americans, which could face resistance from some moderate Democratic lawmakers despite the overwhelming public popularity of increasing taxes on the rich.

Biden’s plan would return the tax rate on the wealthiest Americans to 39.6% after it fell to 37% under the GOP’s 2017 tax law. It would also tax capital gains as income for people making more than $1 million a year ― roughly the wealthiest 0.3% of American households ― and close loopholes used by hedge fund managers and wealthy families to avoid paying taxes.

The administration also proposes spending $80 billion over the next decade to beef up the Internal Revenue Service and target it at wealthy Americans who dodge taxes. Budget cuts in recent years have forced the IRS to focus on auditing middle-income Americans instead of taking on more complicated cases.

Biden is also extending one of the critical pillars of the American Rescue Plan: a monthly benefit for parents. Under the recently enacted package of COVID-19 relief, American families making up to $150,000 will get a monthly check of up to $300 per child, starting sometime after July 1. The law also instructed the IRS to send out the tax credit money in advance, essentially creating a child allowance ― but only for this year.

Molly Aronson

I'm an award-winning blogger who enjoys all things creative but is especially passionate about lifestyle design. I blog over at mehlogy.com I love that I get to share my passion for healthy living, fashion, fitness, and travel with readers from all over the world.

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