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Lightning start:
US President
Joe Biden
presented three major spending programs at the beginning of his term in office
Photo: KEVIN LAMARQUE / REUTERS
In his first speech to the US Congress, President
Joe Biden
(78)
wants to present
far-reaching reform plans for family policy on Wednesday evening.
The 1.8 trillion dollar (1.5 trillion euros) family program is to be financed through higher taxes for the rich, as a government official said in advance.
"The president is going to propose a series of measures to ensure that the wealthiest Americans pay the taxes they owe."
In his speech on the eve of his 100th day in office, Biden is also likely to speak about the progress of the corona vaccination campaign, police reforms, stricter gun controls and migration policy.
At the center of his domestic political agenda, however, is the trillion dollar "American Families Plan".
Is America Getting Parental Allowance?
The plan includes around $ 1 trillion in investments and $ 800 billion in family tax breaks, according to the White House.
The government plans to continue the increase in the child tax allowance from $ 2,000 to $ 3,000 to 3,600, depending on the age of the child, until 2025, which was decided as corona aid.
That alone should cut child poverty in the US in half, according to Congress calculations.
Tax discounts, in order to keep health insurance contributions affordable for millions of families, should even apply permanently.
Around $ 200 billion will flow into preschool education for children aged three and over. The government plans to provide two years of free study at community colleges with $ 109 billion. Additional funding is earmarked for scholarships for low-income students. In total, the state would finance an educational career of up to 17 years.
In addition, $ 225 billion has been earmarked for grants to enable parents to take time off from work to care for children or care for loved ones in the event of illness. This is primarily intended to help middle-class families and, in particular, to enable women, who still do most of the care work, to participate more in the labor market. So far, the USA is the only industrialized country that does not offer maternity protection, parental or child benefits. The program is more ambitious than announced weeks ago. The government had prepared the public for well over $ 1 trillion in family benefits.
Families are also to be supported with the costs of childcare with 225 billion dollars.
Average earners therefore have to spend a maximum of 7 percent of their income on it.
In addition, Biden wants to expand the program for free school lunches and switch unemployment insurance to entitlements that do not depend on budget commitments from Congress.
The whole thing is under the heading of "Care Economy".
Capital gains tax for top earners almost doubled
To finance the reforms, Biden wants, among other things, to
reverse the tax cuts for the rich initiated
by his predecessor
Donald Trump
(74). People with an annual income below $ 400,000, however, should be spared tax increases. "There is broad support from the US population for this approach," said a government official on Wednesday. "These reforms are basically about fairness in tax law."
The top tax rate is to be raised again from 37 percent to 39.6 percent. This would affect around 1 percent of US households. In addition, the normal income tax rate is to be paid on investment income, which so far has only been taxed at 20 percent. According to the information, the capital gains tax would almost double for 500,000 households and thus 0.3 percent of taxpayers. In addition, tax loopholes should be closed for the rich and the financial administration should be given more resources and control options.
It is the third billion dollar reform package that the US government has presented.
A corona aid package worth 1.9 trillion dollars to stimulate the economy has already been decided.
An infrastructure package worth $ 2.3 trillion for the expansion of roads, bridges, broadband and renewable energies is still being discussed.
This is to be financed with higher corporate taxes.
High hurdles in Congress
Biden has to have his reform plans in family policy approved by Congress. There, the planned tax increases in particular are likely to meet with fierce resistance from the Republicans. The whole package will be difficult to get through with just the votes of the Democrats, who have a slim majority in the House of Representatives and who can break the stalemate in the Senate thanks to the vote of Vice President Kamala Harris. The "Budget Reconciliation" procedure, which takes away the opposition's veto power and has already been used for the Corona aid program, may only be used one more time, according to the Senate Administration. Unless some of the Republicans give in to the infrastructure plan, things would look bad for family aid.
But if Biden's three-stroke succeeds, government spending will rise by six trillion dollars.
Over a period of ten years that would be just under 3 percent of economic output - measured against the gross domestic product of the crisis year 2020. However, thanks to the spending programs as well as the effective response to the corona crisis, a boost for America's economy is expected, with which the costs hardly fall Weight fell.
Nevertheless, the state would change its character with greater redistribution and a focus on future investments.
Before Biden presents his plans in detail to Congress on Wednesday evening, according to the White House, he will meet employees who were stuck in the building during the storming of the Capitol by Trump supporters in early January.
At Biden's address itself, instead of the usual around 1,600 senators, members of parliament, government representatives and guests, this time only a selected group of around 200 listeners is allowed due to the corona pandemic.
Three and a half months after the storming of the Capitol, strict security precautions are in place around Congress.
ak / AFP
