By CHRIS MEGERIAN and JOSH BOAK
WASHINGTON — President Joe Biden on Tuesday proposed new taxes on the rich to help fund Medicare, saying the plan would help to extend the insurance program’s solvency by 25 years and provide a degree of middle-class stability to millions of older adults.
In his plan, Biden is overtly declaring that the wealthy ought to shoulder a heavier tax burden. His budget would draw a direct line between those new taxes and the popular health insurance program for people older than 65, essentially asking those who’ve fared best in the economy to subsidize the rest of the population.
Biden wants to increase the Medicare tax rate from 3.8% to 5% on income exceeding $400,000 per year, including salaries and capital gains. That would likely increase tax revenues by more than $117 billion over 10 years, according to prior estimates by the Tax Policy Center.
“This modest increase in Medicare contributions from those with the highest incomes will help keep the Medicare program strong for decades to come,” Biden wrote in a Tuesday essay in The New York Times. He called Medicare a “rock-solid guarantee that Americans have counted on to be there for them when they retire.”
The proposed Medicare changes are part of a fuller budget proposal that Biden plans to release on Thursday in Philadelphia. Pushing the proposal through Congress will likely be difficult, with Republicans in control of the House and Democrats holding only a slim majority in the Senate.
The proposal is a direct challenge to GOP lawmakers, who argue that economic growth comes from tax cuts like those pushed through by President Donald Trump in 2017. Those cuts disproportionately favored wealthier households and companies. They contributed to higher budget deficits, when growth failed to boom as Trump had promised and the economy was then derailed in 2020 by the coronavirus pandemic.
The conflicting worldviews on how taxes would impact the economy is part of a broader…
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