Biden's greedy economic malpractice tax
President Joe Biden is likely staring these days at the rising budget deficit along with his desire to spend far more money than the US Treasury has in its coffers. He must also notice his sinking poll numbers and dim prospects for his party in the November midterm elections. In response he has proposed a wealth tax on the uber rich.
The White House calls it the “billionaire minimum income tax” which is neither limited to billionaires nor is a tax on income. Anyone with a basic understanding of economics may call it instead an “economic malpractice tax”.
As the Wall Street Journal notes, “It’s a new tax on Americans with $100 million or more in assets whose effective tax rate in any year is less than 20% of their income.” Biden is off by an order of magnitude on the billionaire description, like calling someone with $100,000 in net worth a millionaire.
The other fraudulent part is calling it an income tax when it is instead a wealth tax. Per the WSJ, “The 20% minimum tax rate would apply both to ordinary income and the increase in the value of assets in a given year.” An appreciated asset is not considered income until it is sold.
If business owners or entrepreneurs grow their assets through hard work, reinvestment, or just good luck, all they have are unrealized gains, taxable when those gains are realized by selling the asset. And if the asset value rose quickly, it could just as easily fall quickly, perhaps after the IRS collects its tax. Would the IRS then refund the tax if the asset suddenly loses value? No way.
In addition, how would such a taxpayer pay the tax bill? Just because someone has a $100 million asset, that doesn’t mean they have cash on hand to pay the tax man. What if the asset increased in value by $25 million? The Biden tax of 20% would require a $5 million check to the IRS, cash entrepreneurs or business owners may not have on hand if they are reinvesting profits into growing their business.
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Biden hopes to use the collection from the "wealth tax" to buy votes for Democrats. The tax has the effect of taking money that could be used to grow a business and create jobs and giving it to those who haven't earned it. Democrats have become the party of government greed. their policies have the opposite effect of tax cuts which actually grow the economy and create greater revenue for the government. Democrats are too blinded by their greed to see the damage they are doing.
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