While the 2024 Presidential election gets into full swing both of the candidates will make countless statements about how they would govern the country. Both candidates are a sitting President and former President and have track records to indicate how they would govern over the next four years. However, there is a very valuable document voters can use as a crystal ball to see where the current President’s heart truly lies given current dynamics in real time. 

This document can often contain a long “wish list” of what the President would make happen if they were king for a day. In essence, this would be the world they create if there were no pesky hurdles in the way like the House of Representatives, the Senate or the United States Constitution. 

This document is the Annual Budget Proposal from the President of the United States. 

If one is looking for a long list of terrible ideas as well as massive tax hikes, I give you: Joe Biden’s Fiscal Year 2025 Budget Proposal.

Clocking in with a total tax hike of $5.3 TRILLION over the next 10 years from 2024 to 2034 according to the US Treasury, the proposal contains higher taxes on American businesses and high income earners while enshrining special tax breaks and credits for special interests while making the tax code even more complicated than before. 

Worried about what that would do to the American economy? Your worries would be well placed as the tax hikes kick in on the “evil” time honored traditions of saving, investing and working. According to the Tax Foundation in Washington DC, those factors alone would lead to reduced economic output, wages and employment. But who wants any more of that – right? 

In addition, the proposed increase in the corporate tax rate and additional taxes on those having the audacity to earn too much money would make the top U.S. tax rates some of the highest on the planet. Possessing the highest tax rate on the planet, we would only be outdone by the one other country – Columbia. 

The proposal to hike the corporate tax rate from 21% to 28% would not even hurt the “evil” corporations that Biden loves to demagogue. As everyone knows, corporations only remit taxes, they do not actually pay taxes. Taxes are merely passed on to consumers in the form of higher prices, to employees in the form of lower wages and to shareholders in the form of lower profits.

You want to see inflation get even worse than it already is? Raise corporate tax rates. 

Corporate taxes only make up approximately 6.5% of total tax revenue for the United States. President Biden could cripple the economy by jacking up corporate rates while claiming corporations need to “pay their fair share” and he would not even move the needle on what the US Treasury collects. 

The budget proposal also includes these other disastrous tax hikes:

  • Increase the corporate alternative minimum tax introduced in the Inflation Reduction Act from 15% to 21% (effective 2024)
  • Quadruple the stock buyback tax implemented in the Inflation Reduction Act from 1% to 4% percent (effective 2024)
  • Increase the global intangible low-taxed income (GILTI) tax rate from 10.5% to 21%, calculate the tax on a jurisdiction-by-jurisdiction basis (some provisions effective 2024)
  • Repeal the reduced tax rate on foreign-derived intangible income (FDII)

Joe Biden also thinks he is choosing an easy target when he proposes hiking taxes on those individuals making more than $400,000. However, his economic advisors fail to remind him that the vast majority of small businesses pay taxes at the individual level and would take the brunt of such an increase. Killing jobs, killing wages and making it harder for hard working small business owners is the reality of such a boneheaded policy. 

In addition, why is $400,000 level the mark of evil? Why does the government get to determine what level of income is “too much” and should be taxed more? If they can, then what is to stop them from saying $250,000 or $100,000 is too much? The clown show known as the United States Congress will get that right, won’t it?

But wait, there is more! Additional tax hikes on individuals include:

  • Limit 1031 like-kind exchanges to $500,000 in gains
  • Increase top individual income tax rate to 39.6 percent on income above $400,000 for single filers and $450,000 for joint filers (effective 2024)
  • Tax long-term capital gains and qualified dividends at ordinary income tax rates for taxable income above $1 million and tax unrealized capital gains at death above a $5 million exemption ($10 million for joint filers)
  • Limit retirement account contributions for high-income taxpayers with large individual retirement account (IRA) balances
  • Tax carried interest as ordinary income for people earning more than $400,000

As one can see from the list above, the words “tax unrealized capital gains” are starting to show up in this hellscape of ideas. Not only is such an idea completely unworkable and impossible to implement, it is something you would expect to hear from a socialist dictator. Did Mom and Dad pass away while running the family farm? Sorry, sell the farm and pay the tax. Did your assets evaporate over the weekend when the idiots at Silicon Valley Bank ran things into the ground? Sorry, the value was high last week so sell something and pay the tax. Do you disagree with the value the government slaps on your assets? Sorry, pay the tax.

Finally, perhaps one of the worst ideas in the budget would have one unintended consequence that might contain some silver lining. After implementing the 25% “Billionaire tax” contained in the budget proposal, which would levy a tax on unrealized gains of billionaires, proponents of this would find themselves completely out of campaign funds as they run for reelection. All of their billionaire mega donors will have fled the United States to countries that have at least a modicum of common sense left.