(The Center Square)
U.S. Treasury Secretary Janet Yellen testified before the House Ways and Means Committee on Friday, where she answered tough questions about tax increases and new funding for the IRS in the proposed budget. President Joe Biden.
“The budget before us today provides $4.7 trillion in new taxes and $6.9 trillion in new spending, during a staggering debt crisis,” said the chairman of House Ways and Means, Jason Smith, R-Mo., in his opening remarks.
Biden’s budget also caught fire for increasing the national debt. The White House boasted that the budget would cut deficits by $3 trillion over the next decade.
The White House has defended the budget, highlighting these deficit reductions while also spending on Social Security, Medicare and more. Presidents release these budgets every year, but they serve more as symbolic priorities and agenda-setting because there is little hope that the budget will be accepted by Congress.
“It’s built on four key values: lowering costs for families, protecting and strengthening Social Security and Medicare, investing in America, and reducing the deficit by ensuring that this country’s wealthiest and big business begin to pay their fair share, and cut wasteful spending for Big Pharma, Big Oil and other special interests,” Shalanda Young, director of the Office of Management and Budget, told reporters on a call to the press.
The budget includes several proposed tax increases, such as The Center Square before reportedincluding the billionaire tax, a minimum tax of 25% on anyone with more than $100 million, an increase in the top marginal tax rate to 39.6%, an increase in the tax rate companies from 21% to 28%, and more.
The president’s budget means more pain, with $1.8 trillion in new taxes on main street businesses, many of which still have ‘Help Wanted’ signs hanging from their windows due to the fueled worker shortage by Democrats,” Smith added.
Related: The IRS leaked thousands of Americans’ tax returns; Congress demands answers
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Yellen also warned lawmakers about the upcoming debt ceiling. As The Center Square previously reported, lawmakers have just weeks to raise the debt ceiling or default on U.S. debt obligations, an unprecedented event that would send shockwaves through the economy. world. Some Republicans have indicated they want to use the coming cliff to negotiate, but Biden has said he will not negotiate, arguing the stakes are too high.
The Committee for a Responsible Federal Budget has released a comprehensive analysis of the proposed budget, which reports that under the plan, debt would reach 106% of gross domestic product by 2027, a new record high.
“Spending and revenue would average 24.8 and 19.7% of GDP, respectively, over the next decade, with spending reaching 25.2% of GDP and revenue totaling 20.1% by 2033. “, said the group. “The 50-year historical average is 21.0% of GDP for expenditure and 17.4% of GDP for revenue.”
The group’s analysis also indicates that Biden’s forecast is based on optimistic economic assumptions such as strong long-term growth and lower interest rates than expected by the Congressional Budget Office.
“The budget assumes growth of 0.4% this year, 2.1% next year and 2.2% by the end of the decade – compared to 0.1%, 2.5% and 1 .7% respectively for the CBO,” the group said. “The budget also assumes that ten-year interest rates will fall to 3.5% by 2033, compared to 3.8% for the CBO.”
Yellen oversees the Internal Revenue Service, which recently came under scrutiny after the Cut Inflation Act allocated about $80 billion, some of which will be used to hire an army of auditors to increase revenue by auditing Americans. The move was controversial as critics point to recent IRS abuses and targeting of conservatives.
Related: Lawmakers Grill Biden’s Chief IRS Nominee Over New Army of Agents, Backlogs, and More
Biden’s budget raised eyebrows by allocating more than $43 billion to the IRS for fiscal year 2024, a 15% increase.
“After Democrats gave the IRS an $80 billion increase last year, taxpayers are now being asked in this budget to pay the IRS an additional $43.2 billion?” Smith said in his opening statement. “I have to ask: is this a joke? »
Yellen defended IRS spending, pointing to better customer service. The IRS has been criticized for poor customer service in recent years.
“Taxpayers are enjoying significantly improved customer service this year,” Yellen said in her testimony. “For example, we answered hundreds of thousands more phone calls this filing season than this time last year.”
Syndicated with permission from The central square.