Biden's FY 2025 Budget: Higher Tax Rates, IRS Funding Boost
The Biden Administration has unveiled its FY 2025 budget, including tax proposals outlined in the Green Book. Key changes include hiking corporate and individual tax rates, aligning with OECD rules, and bolstering IRS funding.
The Green Book suggests raising the corporate tax rate from 21% to 28%, bringing it in line with the OECD's Pillar Two rules. Additionally, it proposes increasing the highest individual tax rate from 37% to 39.6%. To fund these changes, the budget requests $12.3 billion for the IRS in FY2025, matching the FY 2023 level.
The Green Book also targets capital gains and dividends, proposing to remove lower tax rates for those earning over $1 million. It further suggests increasing the corporate alternative minimum tax from 15% to 21% and hiking the excise tax on stock buybacks from 1% to 4%.
Treasury Secretary Janet Yellen is set to testify before the House Ways and Means Committee and Senate Finance Committee regarding these proposals in the coming weeks. The FY 2025 budget, released on March 11, 2024, aims to raise revenue and reduce the deficit through these tax changes.
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