Democratic presidential candidate Joe Biden plans to pay for $3.2 trillion in policy proposals with new and higher taxes on the wealthy and corporations, including a measure targeting companies like Amazon.com Inc. and Netflix Inc. that have reported paying no federal income taxes in recent years.
The so-called minimum book tax, which his team estimates would raise $400 billion over a decade, would be coupled with increases in the top individual and corporate rates that Biden has already promised, according to a copy of the proposal obtained by Bloomberg News.
The plan also details his call to end loopholes worth hundreds of billions of dollars and other breaks, including stepped up basis so that individuals can no longer pass on appreciated property without having to pay tax on the gain. The document also outlines Biden’s plan to double the global intangible low tax income rate, known as Gilti, and capping the value of breaks for wealthy taxpayers. He also calls for $200 billion in sanctions on countries that “facilitate illegal corporate tax avoidance.”
With the proposal, Biden’s campaign is seeking to show a full list of taxes and other revenue-raising proposals that would pay for all of his spending plans -- a test he has set for his Democratic rivals, especially Senator Elizabeth Warren and her Medicare for All plan.
In another measure aimed at eliminating profits shifting overseas and outsourcing, Biden’s campaign said he supports imposing sanctions on places like Ireland, the Netherlands, the Cayman Islands and Bermuda that “facilitate illegal corporate tax avoidance and engage in harmful tax competition.” His team said it conservatively estimates the revenues raised at $200 billion.
“The vice president does think it’s very important to be clear with the American people regarding how you’re going to pay for things in order to demonstrate they can actually get it done,” said Biden policy director Stef Feldman.
Biden has proposed a $1.7 trillion climate and infrastructure plan, a $750 billion health care plan and a $750 billion higher education plan. That $3.2 trillion in spending over 10 years is far less than other Democrats have proposed spending on health care alone. Warren’s campaign estimates that her health care plan would cost $20.5 trillion over a decade, her climate plan would cost $3 trillion and other proposals trillions more.
Senator Bernie Sanders has said that his health care plan alone would cost more than $30 trillion over a decade.
Biden “wants to make sure that he’s putting proposals out there that he can actually deliver on for folks,” Feldman said. “He thinks that in many ways it makes it easier for people to buy into the idea that we should be making these investments because they respond to it along the lines of, ‘Oh, you know what, it does seem like wealthy people can pay a little bit more if what we get is this.’”
Biden would introduce a 10% minimum tax on book income aimed at companies that reported net income of more than $100 million in the U.S. but paid zero or negative federal income taxes.