President Joe Biden proposed his $6.8 trillion federal budget plan the same week as Governor Shapiro’s Budget address. In a speech at Philadelphia Union Hall, President Biden’s detailed his proposal, which is an 8% increase over this fiscal year.
The proposal calls for the full restoration
of the Child Tax Credit from $2,000 per child to $3,000 per child for children six years old and above, and to $3,600 per child for children under six. The original child care tax credit was enacted during COVID with the American Rescue Plan and Biden’s proposal for this year is to make it permanent. The Biden Budget proposal also includes funding and tax incentives for affordable housing, including $10 billion to municipalities to address restrictive zoning.
However, President Biden’s proposal raises the corporate tax rate by 7%, restores the 39.6% tax rate for single filers earning at least $400,000 a year and married couples earning at least $450,000, quadruples the corporate stock buybacks tax and increases the Medicare tax rate from 3.8% to 5% for high-income earners. The latter has the goal to extend Medicare solvency beyond 2050 and President Biden would also like to close loopholes in existing Medicare taxes and dedicating the Medicare net investment income tax to the Hospital Insurance Trust Fund.