Study: NJ and Massachusetts Would Get Hit With Biden’s Tax Burdens the Hardest
President Joe Biden’s proposed multi-trillion-dollar infrastructure and jobs bill is paired with massive tax increases on corporations and wealthy individual plans that could affect a larger number of taxpayers in certain states, according to a new report.
President Joe Biden’s proposed multi-trillion-dollar infrastructure and jobs bill is paired with massive tax increases on corporations and wealthy individuals, plans that could affect a larger number of taxpayers in certain states, according to a new report.
The Institute on Taxation and Economic Policy, a progressive research group, found that 1.2 percent of New Jersey taxpayers would see tax hikes under Biden’s law. That’s tied with the group’s projections in Massachusetts, as 1.2 percent of taxpayers in the state would also face tax increases.
But that still indicates that 98.8 percent of taxpayers in New Jersey and Massachusetts wouldn’t experience tax hikes. And nationally, only 0.7 percent of taxpayers would be impacted by Biden’s tax plans, with nearly all of the impending potential tax burden to fall on the richest one percent.
“The president’s proposed tax increases would affect only the very rich, one percent or less of taxpayers,” Steve Wamhoff, the group’s director for federal tax policy, said. “If you are a remotely normal American, you will not pay more and you probably don’t even know anyone who will pay more.”
Washington, D.C., and three other states—New York, California and Connecticut—are the only other regions where more than one percent of the population would be affected by the tax hikes under Biden’s plan. Those are also the states that have the highest-income taxpayers and highest average income per person.
States that will have the fewest percentage of high-income earners impacted by the president’s tax overhaul include West Virginia at 0.1 percent and Arkansas, Louisiana, Mississippi, New Mexico, Oklahoma and South Carolina at 0.3 percent, according to the report.
Biden’s tax plan would restore the top personal income tax rate to 39.6 percent, up from 37 percent enacted under former President Donald Trump and a Republican-controlled Congress. The president is also proposing an increase to the long-term capital gains rate to 39.6 percent, up from 20 percent, a hike that would apply to households making more than $1 million.
In another effort to fund his $3.5 trillion infrastructure and family plan, Biden is calling for tax hikes on individuals making more than $400,000 per year, though the measure is widely unclear across his administration. He reiterated that any person earning less than the threshold wouldn’t see a tax increase, but White House press secretary Jen Psaki announced that the income level referred to family income.
Days later, Psaki came out and said “nobody making under $400,000 a year will have their taxes increased.”
It’s still unclear who would bear the tax burden.
Rachel Bucchino is a reporter at the National Interest. Her work has appeared in The Washington Post, U.S. News & World Report and The Hill.