Saturday 15 May 2021
Home International Biden raises tax bill for corporate groups and wealthy Americans

Biden raises tax bill for corporate groups and wealthy Americans

US President Joe Biden has disclosed a multi-billion dollar investment in the US 'social infrastructure'. He has been president for 100 days this week and delivered his first address to the joint Congress.

Biden's government will invest heavily in more childcare, better education, health care and longer paid parental leave.

For this so-called American Families Plan, he wants to spend $1 trillion, plus $800 billion in tax credits. He pays the cost of 1.8 trillion from increases in taxes for wealthy Americans (with incomes above one million) and for large businesses, but makes an exception for small farmers and family agricultural businesses.

There will be a new transfer and inheritance tax on the sale of businesses and share packages, for transactions and inheritances over $ 1 million. But that will not apply to agricultural businesses that are continued by children and heirs.

With the new US tax plans, an ambitious global tax deal also appears to be getting closer. Currently, multinationals can shift their profits between countries ('tax havens') in such a way that they hardly have to pay tax. Biden wants one minimum rate worldwide.

Since 2013, the Organization for Economic Cooperation and Development (OECD) has been working on plans to effectively tax large companies. In anticipation of such a global agreement, the European Union has put plans for its own tax on internet companies such as Google and Facebook on hold.

Biden is coming to Europe in June, and is expected to also make agreements about closer economic cooperation with the EU countries.

Several EU countries, including Germany, France and the Netherlands, have reacted cautiously positively, but have not yet expressed explicit support for the rate of 21%.

According to the Dutch MEP Bas Eickhout (GroenLinks), there remains a risk that European low-tax countries such as Ireland will try to lower this rate ”. In a resolution yesterday, a broad majority of the European Parliament also welcomed the US proposal for a minimum rate.

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