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THE BIG DEAL—Businesses, wealthy brace for Biden tax hikes: Businesses and wealthy individuals are preparing for the potential for former Vice President Joe Biden to raise taxes if he wins the presidential election.
Biden has released several proposals aimed at raising taxes on high-income people and businesses, though it remains to be seen how quickly and aggressively he would pursue tax increases if he wins.
Professionals at law and accounting firms say that businesses and wealthy individuals are already asking about how they may be affected so they can be ready to take actions to minimize their tax bills.
“A lot of businesses and stakeholders, particularly the more sophisticated ones, are definitely actively assessing what the proposals could mean for them and their business,” said Jorge Castro, who was on former President Obama’s transition team in 2008 and now works at Miller & Chevalier.
The Hill’s Naomi Jagoda tells us more here.
The plans: Biden plans to raise taxes on wealthy individuals and businesses, though he said he would not raise taxes on individuals making under $400,000.
- Biden plans to roll back President Trump’s tax cuts for individuals making over $400,000 annually. This would include rolling back reductions in tax rates and phasing out a deduction for income from non-corporate businesses known as “pass-throughs.”
- The former vice president has also proposed taxing capital gains at the same rate as ordinary income for people with income above $1 million — raising the top rate from 20 percent to 39.6 percent — and taxing unrealized capital gains at death.
- Biden has said he wants to return the estate tax to its parameters in 2009, increasing the corporate tax rate from 21 percent to 28 percent and making changes to a minimum tax on the foreign earnings of U.S. multinational corporations.
LEADING THE DAY
Dow falls more than 650 points as COVID-19 cases rise, stimulus hopes fade: Stocks were down badly on Monday as U.S. daily coronavirus cases hit record highs and investors dealt with the likelihood that stimulus negotiations will not produce a bipartisan relief deal before Election Day.
The Dow Jones Industrial Average closed with a loss of just more than 650 points after losing more than 900 points earlier in the day. The S&P 500 index closed with a loss of 1.9 percent, and the Nasdaq composite fell 1.6 percent.
Monday’s losses came amid increasing concern that the U.S will suffer under a punishing, nationwide surge in coronavirus cases with no further help from the federal government until after the elections.
- More than 83,000 new U.S. cases of COVID-19 were confirmed Saturday, shattering previous records.
- The rise in COVID-19 cases has sparked fears that the U.S. will need to reimpose restrictions and business closures that had been previously lifted, following in the footsteps of European countries who have done the same.
- The U.S. is on track to face that resurgence without the boost from a bipartisan coronavirus relief bill barring a stunning breakthrough in talks between Speaker Nancy Pelosi (D-Calif.) and Treasury Secretary Steven Mnuchin.
Kudlow doesn’t expect Trump to release detailed economic plan before election: White House economic adviser Larry Kudlow suggested on Monday that the Trump administration would not be releasing a detailed second-term economic plan before the Nov. 3 election.
In an interview with Fox News, Kudlow said that the administration is “deep into discussions” about potential second-term plans for taxes and regulations, and that he’s also spoken to U.S. Trade Representative Robert Lighthizer about possible future plans for trade.
But Kudlow also said he doesn’t “see any reason why we have to put out a detailed plan.”
Kudlow’s comments on Monday are contrary to comments he’s made previously. In January, Kudlow said that he expected Trump to roll out a new tax proposal as part of his reelection campaign.
Here’s more from Naomi.
GOOD TO KNOW
- The IRS announced Monday that it is giving certain recipients of federal benefits more time to register to get stimulus payments for their children this year.
- Ride-hailing app Uber is being sued over allegations that the company’s rating system for drivers is racially biased, according to a complaint filed Monday in federal court.
- The Trump administration is getting pushback from industry groups, both sides of the aisle and even internally about the Pentagon’s moves toward a possible 5G network owned and operated by the government.
- Food service groups are offering local alternatives to major delivery apps.
- A top appointee to the panel that advises the government on employee compensation resigned Monday over a recent order from President Trump that would strip some federal workers of their employment protections.