US President Joe Biden to ‘Propose Hiking Tax on Rich’

US President Joe Biden is reportedly to propose a tax hike on the wealthiest Americans.

This will result in the rise of the top marginal rate and increase taxes on investment gains for the rich.

There’s a budget already for the funds that will be accumulated for the tax rise, these funds would be spent on childcare and education, but the healthcare sector was excluded, according to the report.

This proposal ignited the sell off on Wall Street, with major indexes dropping during Thursday’s trading session.

The news originated from the White House. It was further explained, the American Family Plan, in which US President Joe Biden is required to explain the full details of the plan next week; this plan is not going to affect any family earning less than $400,000 a year.

“His view is that that should be on the backs… of the wealthiest Americans who can afford it and corporations and businesses who can afford it,” as explained by White House Press Secretary Jen Psaki.

The proposal will raise the top marginal income tax rate to 39.6% from 37%, as reported by Bloomberg and the New York Times.

The proposal would surely overturn Donald Trump’s 2017 income tax cut for the highest income earners.

The agenda would also practically double taxes on capital gains to 39.6% for people receiving more than $1m.

It’s a stunning rise from the present rate of 20%.

It’s likely that in some states which require their capital gains tax, the total bill some investors are going to pay might exceed 50%.

President Biden calls out to nations for help to “overcome the existential crisis of our time.”

The plan is generally foreseen to encounter barriers from the Republican senators that are in the congress.

The Democrats, on the other hand, may not vote the plan unanimously, though they hold a slim majority.

However, this news was capable of causing a few jitters on Wall Street.

The Dow Jones Industrial Average fell 420 points before reining in its losses slightly.

“If it had a chance of passing, we’d be 2000 points,” Thomas Hayes, from Great Hill Capital, told Reuters.

US President Joe Biden is not backing down on this proposal.