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. Those cuts disproportionately favored wealthier households and companies. The proposal is a direct challenge to GOP lawmakers, who argue that economic growth comes from tax cuts like those pushed through by former President Donald Trump in 2017.
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. But funding for the program is a problem with federal officials warning that, without cuts or tax increases, the Medicare fund might only be able to pay for 90% of benefits by 2028.īiden’s suggested Medicare changes are part of a fuller budget proposal that he plans to release on Thursday in Philadelphia. The number of Medicare enrollees is expected to continue growing as the U.S. More than 65 million people rely on Medicare at a cost to taxpayers of roughly $900 billion every year. Senate Minority Leader Mitch McConnell, R-Ky., was quick to dismiss the plan, telling reporters on Tuesday that Biden’s budget agenda “will not see the light of day.” He called Medicare a “rock-solid guarantee that Americans have counted on to be there for them when they retire.” “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. The White House did not provide specific cost-saving estimates with the proposal, but the move would likely increase tax revenues by more than $117 billion over 10 years, according to prior estimates in February by the Tax Policy Center. 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.īiden wants to increase the Medicare tax rate from 3.8% to 5% on income exceeding $400,000 per year, including salaries and capital gains. In his plan, Biden is overtly declaring that the wealthy ought to shoulder a heavier tax burden. WASHINGTON (AP) - 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.
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