(Bloomberg) -- Former Vice President Joe Biden wants to raise taxes on the wealthy. Senator Bernie Sanders wants to send those levies off the charts.
Biden’s tax plan would raise individual income taxes by about $109 billion over a decade, according to new estimates from the right-leaning Tax Foundation. In contrast, Sanders’s plan would raise taxes on the richest Americans by nearly $3.2 trillion in that same period, according to the data.
The figures show the sharp contrast in the scope of how the two leading contenders for the Democratic presidential nomination would seek to alter the tax bills of some of the wealthiest people in the U.S.. The primary contest has long been marked by plans to raise taxes on top earners, and the last two major candidates standing represent the two extreme ideological ends of what was once a wide field.
Biden has called to repeal the 2017 tax cuts benefiting top earners, a change that would raise the top individual income tax rate to 39.6% from 37%.
Sanders proposed raising the top tax rate to 52% for those making $10 million or more. He has also called for a 4% income-based premium on households as part of his plan to finance Medicare-for-All. The Vermont senator and self-described democratic socialist has also called to repeal a deduction for owners of partnerships and limited liability companies included in the 2017 tax law.
The Tax Foundation analysis, which just focused on individual income tax proposals, didn’t address other taxes that could affect the richest Americans, such as changes to capital gains levies or wealth taxes.
Biden and Sanders have staked out vastly different territory when it comes to taxation. Sanders is calling for steep increases in individual and business taxation, calling for tens of trillions in new taxes to fund a universal health system.
Biden has taken a much more moderate approach that would raise levies on some top earners and companies that book profit offshore, but the size of his tax plan ranges between $3 trillion and $4 trillion, according to several estimates.
Sanders’s plan would reduce gross domestic product by about 2% over a decade, according to the estimates, while Biden’s plan would have no effect on GDP.
The individual income tax revenue is the largest single source of money for the federal government, amounting to about 50% of federal revenue, according to the Congressional Budget Office.
©2020 Bloomberg L.P.
RECOMMENDED FOR YOU
POPULAR