Treasury Secretary Janet Yellen told CNBC Friday that the $ 1.75 trillion framework for President Joe Biden’s climate and social spending priorities is being “paid in full,” in part by encouraging rich Americans to be more Pay taxes.
“We have tried to develop a package of revenue increases that is acceptable to members of Congress. We have adjusted some rate hikes that were not acceptable to members of the Senate,” Yellen said in an interview with CNBC’s Sara Eisen. Worldwide Exchange “. “From Rome, where the group of 20 leaders is gathering for their first face-to-face summit since the Covid pandemic.
“However, the educators we have are adequate and fair. While there is no mark-to-market billionaire tax, I think it has been agreed that people with high incomes … pay a surcharge on their income tax rates.” Yellen said, “It hits really high-income people.”
The proposal for a tax on unrealized gains on billionaires’ wealth has been thwarted and questions have been raised as to whether it is even constitutional.
Yellen, former chairman of the Federal Reserve, accompanies Biden on his trip abroad to the G20 summit and the United Nations climate change conference in Glasgow, Scotland.
Before leaving Washington on Thursday, Biden announced an agreement with Senate Democrats on draft spending on a variety of programs to ease the financial burden on families and children while funding the renewable energy economy.
If the massive spending bill were passed, a minimum tax of 15% would be levied on corporate profits of large corporations, the Yellen-mediated minimum global tax of 15% would be levied, and a surcharge of 5% would be levied on individual incomes over $ 10 million. That rate would increase an additional 3% for an income above $ 25 million. The Democrats’ plan also includes a 1% surcharge on company stock repurchases.
“I don’t think these investments will drive inflation up,” Yellen said on Friday. “First and foremost, they are paid in full – not through taxes on people on less than $ 400,000, but by asking companies and high income individuals to pay their fair share and by investing in the Internal Revenue Service so they can increase their revenue compliance that has come down to low levels, “she added.” We have a huge amount of uncollected tax revenue, a tax gap valued at $ 7 trillion over a decade. “
At the G20, Yellen will have a winning streak in the global minimum corporate tax, which all member states will agree to. The deal was negotiated between more than 130 countries.
Biden had hoped it would be enough to rally the Democrats behind the framework for his spending priorities to get a separate bipartisan infrastructure bill already passed in the Senate across the finish line in the House of Representatives. However, the House abandoned plans for a vote on an infrastructure bill on Thursday, with progressives seeking more time to review the implications for both bills.