ICYMI: The Biden Tax Plan Will Make the Wealthy Pay Their Fair Share While Protecting Family Farms and Businesses

For too long, working families have felt the squeeze of stagnating wages and an ever-increasing cost-of-living even as the U.S. tax code enables the wealthiest Americans to get further and further ahead. President Biden's Build Back Better tax agenda will not only reverse the biggest 2017 tax law's biggest giveaways, but reform the tax code so that the wealthy have to play by the same rules as everyone else.

According to a new report from the Center for American Progress, President Biden's tax plan would "close a capital gains loophole favoring the wealthiest Americans." Under the President's plan, households making over $1 million—the top 0.3 percent of all households—will pay the same 39.6 percent rate on all their income, equalizing the rate paid on investment returns and wages. Moreover, the President would eliminate the loophole that allows the wealthiest Americans to entirely escape tax on their wealth by passing it down to heirs. This will fix one of the most unfair aspects of our tax system: that the tax rate the wealthy pay on capital gains and dividends is less than the tax rate that many middle-class families pay on their wages. The revenue raised from creating a fairer tax system will help pay for investments that will grow our economy and rebuild the middle class, creating jobs, boosting wages, and delivering historic middle class tax cuts.

The report also notes that "critics' harshest claim—that the Biden plan would force families to sell their farms and businesses, thereby preventing transfers from one generation to the next—is simply not true." The President's plan is designed with protections so that family-owned businesses and farms will not have to pay taxes when given to heirs who continue to run the business. According to the report, "many of these claims are based on flawed studies, including some that do not even analyze the actual Biden proposal." The report concludes that, "Those affected by the Biden proposal will not be family farmers or family business owners, but rather the heirs of stockholders, bondholders, and landlords. The working class will be protected, even as the passive rich will not."

Read the full Center for American Progress report here.