President Biden on Monday, March 28, unveiled a new minimum tax targeting U.S. billionaires as part of a 2023 budget proposal.
The Biden administration is set to propose a 20% minimum tax on U.S. households of wealth worth more than $100 million.
A billionaire who is not paying 20% of his or her income would be required to make an additional payment to offset the value of the new minimum. While those who are already paying such percentage will not be required to pay the additional tax, according to Fox News.
The plan, called “Billionaire Minimum Income Tax”, aims to raise about $360 billion over the next decade from about 0.01% of Americans. According to a White House statement released Saturday, it would primarily target the more than 700 U.S. billionaires.
The plan would require these households to pay a tax on all their income, this includes unrealized investment income that is now not taxed, according to the fact sheet.
Stocks and property are not considered taxable income subject to being taxed unless that person sells the asset.
“As a result, this new minimum tax will eliminate the ability for the unrealized income of ultra-high-net-worth households to go untaxed for decades or generations,” the White House budget proposal says.
According to Biden administration estimates, the nation’s deficit, which in 2021 reached nearly $2.8 trillion, would be reduced by more than $1 trillion over the next decade.
Although it is not yet certain that Biden’s proposal will be approved by congressional Democrats, and he will face stiff opposition.
Last year, Biden attempted to impose a 1% tax on stock buybacks, but the proposal failed in Congress.