President Joe Biden has pledged to raise taxes on the affluent and major corporations, unveiling plans in his State of the Union speech to increase corporate minimum taxes and reduce deductions for CEO compensation and corporate jets. Biden previewed the initiatives that will be included in a proposed fiscal 2025 budget unveiled next week, which aims to reduce the government deficit by $3trn over ten years while lowering taxes for low-income Americans and assisting middle-class homebuyers. The President proposed a new tax credit to help Americans buy their first homes or upgrade to larger ones by providing the equivalent of $400 per month for the next two years to offset high mortgage rates. Biden also proposed eliminating title insurance on refinancings of federally backed mortgages, which could save homeowners $1,000 or more. Most of Biden’s tax measures have little chance of passing unless Democrats gain large majorities in both chambers of Congress in November, which polls suggest is improbable. In addition to prior calls to raise the corporate income tax rate to 28% from 21%, Biden also called for an increase to “at least 21%” for the 15% corporate minimum tax that he secured as part of 2022 clean energy legislation. The tax is levied on companies that report profits above $1bn.
