Democrats snuck a handful of surprise tax hikes on corporations in President Biden‘s sweeping coronavirus relief package that combined are worth more than $60 billion.

One provision in the $1.9 trillion stimulus bill limits deductions for publicly traded companies that pay their top employees more than $1 million for tax years beginning after 2026. Another extends a cap on how much certain unincorporated business owners can deduct against their non-business income to reduce their tax liability and the third clamps down on how multinational corporations do their taxes.

The Biden administration has been reluctant to raise taxes during the pandemic, with millions of businesses and families still reeling financially. But according to Politico, which first reported the news, Democrats ran into an issue with rules that strictly regulate legislation being passed via budget reconciliation.

US SPENDING ON COVID RELIEF POISED TO HIT $6T WITH PASSAGE OF BIDEN’S RELIEF BILL

Had Democrats exceeded their $1.9 trillion budget cap for the plan, they risked facing an insurmountable Republican filibuster in the Senate. But by adding the tax increases, Democrats managed to keep their plan’s cost in check, even with the last-minute addition of a measure that waives taxes on the first $10,200 in unemployment benefits.

The House passed the aid package on Wednesday afternoon, sending the bill to Biden’s desk. The president plans to sign the bill into law on Friday, the White House said.

To offset the costs, Democrats extended a $500,000 limit on how much businesses formed as pass-through entities can deduct in losses from nonbusiness income like stocks and bonds by an additional year. The cap, part of Republicans’ 2017 Tax Cuts and Jobs Act, was poised to sunset in 2025. It’s expected to raise $31 billion, according to the Senate Finance Committee.

SOME FAMILIES COULD RECEIVE UP TO $14,000 FROM BIDEN’S RELIEF BILL

But critics suggest its inclusion violates Biden’s campaign promise to not raise taxes on Americans earning less than $400,000. An analysis last year by the Joint Committee on Taxation, a non-partisan organization, found that the cap would raise taxes on 45,000 taxpayers who earn less than $200,000.

“If Biden and Harris want to keep their pledge, they must veto the bill or instruct congressional Democrats to insert bill language exempting households making less than $400,000 in a given year,” said Alexander Hendrie, director of tax policy at the Americans for Tax Reform.

Democrats expect to produce $22 billion in new revenue by permanently repealing a provision in current law that gives U.S. multinationals the leeway to choose how to account for their interest costs when they do taxes.

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The legislation will also raise roughly $6 billion in new revenue by targeting executive compensation; under current law, businesses are able to deduct most employees’ pay — generally barring that of the CEO, CFO, and the three highest-paid officials — from their tax bill.

But Democrats modified the law to include five other highly paid officials in the restriction, bringing the total number of employees to 10.

Of course, the tax increases are far outweighed by the amount of tax revenue cut by the relief legislation, worth an estimated $590 billion, according to the official Joint Committee on Taxation. The stimulus bill includes a $1,400 stimulus check for millions of Americans and a generous, one-year expansion of the child tax credit.

The post Biden’s coronavirus relief bill includes $60B in surprise tax hikes first appeared on Garner Ted Armstrong Evangelistic Association.

Biden signs American Rescue Plan

President Biden on Thursday signed into law the sweeping $1.9 trillion coronavirus relief package that Democrats muscled through Congress without any Republican support, securing the first big legislative win of his presidency.

“This historic legislation is about rebuilding the backbone of this country and giving the people of this nation, working people, the middle-class folks, people who built the country a fighting chance,” Biden said.

The measure includes a $1,400 check for many Americans and an extension of a $300 weekly unemployment aid supplement through Sept. 6, as well as a generous one-year expansion of the child tax credit. It also provides hundreds of billions of dollars in funding for state and local governments, vaccine distribution efforts, and small businesses still reeling from the pandemic.

BIDEN’S CORONAVIRUS RELIEF BILL INCLUDES $60B IN SURPRISE TAX HIKES

Biden had initially been scheduled to sign the bill on Friday, but the White House moved up the timeline to Thursday afternoon in order to distribute the aid “as fast as possible,” Ron Klain, the president’s chief of staff, wrote on Twitter. Klain added: “We will hold our celebration of the signing on Friday, as planned, with Congressional leaders!”

Biden’s signature caps off a two-month sprint by Democrats to unleash another torrent of federal money intended to bolster the economy‘s recovery from the pandemic nearly one year after the crisis began.

Democrats have touted the law as one of the most progressive pieces of legislation in history, pointing to some estimates that suggest it will slash poverty by a third this year and potentially cut child poverty in half and have argued it’s needed to revive the virus-battered economy. More than 20 million Americans are collecting some type of jobless aid, and there remain about 9.5 million fewer jobs than there were one year ago before the crisis began.

SOME FAMILIES COULD RECEIVE UP TO $14,000 FROM BIDEN’S RELIEF BILL

But Republicans, none of whom voted for the bill, have blasted the bill as a wasteful spending frenzy that does more to address liberal wishlist items than the dual health and economic crises.

“The American people already built a parade that’s been marching toward victory,” Senate Minority Leader Mitch McConnell said on Thursday. “Democrats just want to sprint to the front of that parade and claim the credit.”

The sheer size of pandemic-related spending in the U.S. is entirely without precedent: Lawmakers already approved about $4.1 trillion in relief measures under former President Donald Trump, according to a COVID-19 money tracker published by the Committee for a Responsible Federal Budget, bringing total federal spending on the crisis to roughly $6 trillion.

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The exorbitant level of spending has pushed the nation’s deficit to a record $3.1 trillion for the 2020 fiscal year (which does not include the $900 billion relief plan approved in December). The national debt is on track to hit $30 trillion by the end of 2021.

Biden signed the measure in the Oval Office just hours before he is set to deliver a primetime televised address, during which he said he plans to “talk about what we’ve been through as a nation this past year.”

“But more importantly, I’m going to talk about what comes next,” he said. “I’m going to launch the next phase of the COVID response and explain what we will do as a government and what we will ask of the American people.”

From here, the president is set to kick off an aggressive travel campaign to sell the relief plan to American voters and convince them it’s responsible for the economy’s recovery.

“Help is here,” Biden tweeted Wednesday. “And brighter days lie ahead.”

Source: https://www.foxnews.com/politics/biden-signs-coronavirus-relief-bill-first-major-legislative-win

The post Biden signs $1.9T coronavirus relief bill in first major legislative win first appeared on Garner Ted Armstrong Evangelistic Association.