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Today, the Biden Administration released its budget for fiscal year 2024, calling for a reduction in federal deficits by $2.9 trillion over the next decade relative to current law. The budget includes policies that would increase revenues over the next 10 years, more than offsetting the proposed spending increases over that period. While this is a start for addressing the country’s fiscal trajectory, it does not fully address the underlying structural imbalance that defines our fiscal outlook in the decades ahead.
Below are the key takeaways from the budget:
|Policy Proposal||Deficit Reduction (Billions)|
|Increase the corporate tax rate from 21% to 28%||$1,326|
|Reform international taxation||667|
|Close Medicare tax loopholes and increase Medicare payroll tax for high-income earners||650|
|Global minimum tax and related reforms||493|
|Increase the top marginal income tax rate to 39.6 percent and reform taxation of capital gains||449|
|Establish a minimum income tax on wealthy households||437|
|Increase excise tax on corporate stock buybacks from 1% to 4%||238|
SOURCE: Office of Management and Budget, Budget of the United States Government: Fiscal Year 2024, March 2023.
NOTE: Deficit reduction is over the 2024–2033 period. Estimates are based on OMB’s economic assumptions.
© 2023 Peter G. Peterson Foundation
President Biden deserves credit for putting forward a budget that reduces deficits by nearly $3 trillion over the next decade. However, as deficits are projected to total nearly $20 trillion during that timeframe, this budget is not sufficient to solve the country’s fiscal challenges. A more comprehensive budget proposal would fully address the structural drivers of our debt. As budget season gets underway, the President and Congress should work together to establish priorities that ensure economic growth and put America on a more solid fiscal foundation.
Related: Interest Is Skyrocketing, And The National Debt Will Reach An All-Time High In Just 5 Years
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