Biden to include minimum tax on billionaires in Budget proposal

US President Joe Biden (Image: AP)

The White House will ask Congress on Monday to pass a new minimum tax on billionaires as part of a budget proposal intended to revitalize President Joe Biden’s domestic agenda and reduce the deficit.

The tax would require that U.S. households worth more than $100 million pay a rate of at least 20% on their income, as well as unrealized gains in the value of their liquid assets, such as stocks and bonds.

Biden’s proposal to impose a tax on billionaires is the first time he has explicitly called for a wealth tax. While many in his party have advocated taxes that target an individual’s wealth — not just income — Biden has largely steered clear of such proposals.

The “Billionaire Minimum Income Tax” would apply only to the top 0.01% of U.S. households. Those already paying more than 20% would not owe any additional taxes, although those paying below that level would have to pay the difference between their current tax rate and the new 20% rate.

The payments of Biden’s minimum tax would also count toward the tax that billionaires would eventually need to pay on unrealized income from assets that are taxed only when they are sold for a profit.

The tax proposal will be part of the Biden administration’s budget request for the next fiscal year, which the White House plans to release Monday. In a document outlining the minimum tax, the White House called it “a prepayment of tax obligations these households will owe when they later realize their gains.”

“This approach means that the very wealthiest Americans pay taxes as they go, just like everyone else,” the document said.

The White House released a separate document Saturday saying that Biden’s budget proposal would cut federal deficits by a total of more than $1 trillion over the next decade.

This article originally appeared in The New York Times.

By Zolan Kanno-Youngs