One of former President Donald Trump’s signature accomplishments in his first term was the passage of the Tax Cuts and Jobs Act, which permanently decreased corporate tax rates from 35% to 21%, and decreased individual tax rates by a substantial, though varying depending on income, amount. Now, President Biden’s budget for when those temporary cuts expire in 2025 would, instead of continuing them, hike taxes on Americans in what the Trump campaign warned will be the “largest tax hike ever.”
The tax increase would come as part of Biden’s budget plan for fiscal year 2025. The $7.3 budget calls for a $4.9 trillion tax hike and, according to Republicans on the House Budget Committee, would call for an “unprecedented $86.6 trillion in spending” over just ten years. Further, the plan would create the “largest debt in American history,” pushing the national debt to $54 trillion by just 2034, according to those same House Budget Committee Republicans.
The Trump Campaign obliterated Biden for the budget. According to Fox Business, a Trump spokesperson said the Biden budget tax hikes “would take nearly $40,000 dollars away from the average American family, who is already losing thousands every year due to Biden’s record-high inflation crisis.” Continuing, the Trump campaign added that the Biden budget is “defined by massive spending increases and tax hikes on Americans.”
That Trump Campaign spokesperson added that Trump, in contrast to Biden, would stay focused on cutting taxes and pushing down energy prices, saying, “When President Trump is back in the White House, he will advocate for more tax cuts for all Americans and reinvigorate America’s energy industry to bring down inflation, lower the cost of living, and pay down our debt.” Trump has promised that, if reelected, he will make the Tax Cuts and Jobs Act tax cuts permanent.
Similarly, the Manhattan Institute’s Brian Riedl noted that the tax hikes would just be plowed into more entitlement spending, so the debt would continue going up even as taxes went up dramatically. He said, in a post on X, “And yet the $5T in new taxes ($2.6T after including the endorsed TCJA extensions for < families $400k) would be plowed into $2.5 in new entitlement expansions. So all these historic, revenue-maximizing taxes would barely even cut the deficit. Most goes to more spending.”
A White House official, defending the Biden budget, alleged that it would increase taxes on the wealthy, not the middle class, saying, “The president is simply reiterating what’s in his budget. He would let the Trump tax cuts for big corporations and the richest Americans — those making more than $400,000 — expire, and extend the tax cuts for those making less than $400K.”
Continuing, that official claimed, “In fact, his budget would further cut taxes for the middle class and working families. He has said that repeatedly and in every budget. Trump and Republicans are responsible for the egregious and fiscally reckless cliff that is in the Trump Tax Cuts —they are the reason taxes will rise for the middle class after 2025.”
Watch Trump speak about the tax hike issue here:
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