Biden Floats Net Investment Income Tax Hike in New Budget
The new PPLI restrictions could save $6.9 billion over a 10-year period, according to the budget analysts.
The analysts have increased their 10-year revenue estimate for a provision changing trust tax rules about 10%, to $84 billion.
The budget backdrop: Economists note that U.S. budget deficits are different from household debt: The United States has $144 trillion in net wealth it can use to support its debt.
But the federal government has been posting large losses. It’s expected to lose $1.9 trillion on $5 trillion in revenue this year, compared with a loss of $1.7 billion on $4.4 trillion in revenue in 2023.
The budget process: A president’s budget proposal is part of the tug-of-war between the White House and Congress that shapes federal spending. Actual spending and revenue-raising may have little to do with the presidential budget.
The budget proposals also tend to describe many revenue-raising provisions only in general terms. The U.S. Treasury Department describes the provisions in more detail in “Greenbook” reports. The department has not posted the fiscal year 2025 Greenbook, but the new budget provisions appear to be based on the provisions in the 2024 Greenbook.
The White House. Credit: Adobe Stock
