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November 04, 2021 at 01:55 PM
What You Need to Know
- Increasing the cap on state and local tax deductions to $72,500 from $10,00 would raise about $2 billion over a decade.
- High-earners would pay $640.2 billion more in federal levies over the next 10 years, according to the estimates.
The House’s version of President Joe Biden’s signature social-spending bill raises nearly $1.48 trillion in new tax revenue, according to the Joint Committee on Taxation.
The money from tax increases on the wealthy and corporations falls short of the $1.75 trillion that Democrats say they want to spend on new social programs.
The estimate doesn’t include revenue from increasing Internal Revenue Service enforcement, which will be included in Congressional Budget Office projections later.
The White House expects it can raise an additional $400 billion over a decade by giving the IRS $80 billion in additional funding to increase audits and improve taxpayer compliance.
The JCT calculations also don’t include additional savings from a drug pricing deal that would allow the federal government to negotiate prescription prices. The White House estimates that would raise about $250 billion in additional savings to offset the cost of the plan.
Fiscally conservative Democrats have said they want to see analyses of the bill’s costs from both the JCT and the CBO before proceeding with a vote on the tax and spending measure.
