Powerful Democrat Promises Tax Hikes Next Year if Party Retains Power

The powerful chairman of the House Ways and Means Committee, Richard Neal (D-MA) reportedly told a Bloomberg reporter that the party will raise individual and corporate taxes next year if it retains control of the House.

Bloomberg reported that the tax increases could potentially come during a recession and at a time when the nation is still struggling with four-decade-high inflation. Neal said the action would follow the pattern of the Ways and Means Committee proposal in 2021.

That plan, which fell apart when Build Back Better tanked, included expansion of the 3.8% net investment income tax, adding a 5-8% surcharge on certain payers, and a 15% minimum tax on larger corporations.

That, of course, is if Democrats hold onto the House after the November midterms, a tall order with a historically unpopular president at the party’s helm.

Already, the party has rammed through the so-called Inflation Reduction Act for President Joe Biden to sign into effect. It is a vast social spending and new taxation measure that includes a massive expansion of the Internal Revenue Service.

The agency gets an unprecedented boost of 87,000 new IRS positions and $80 billion over the next decade. The administration tried to take some of the edge off the massive buildup in tax regulatory power by claiming some of the positions funded will be for those retiring in the next five years.

The act floundered for months before a breakthrough agreement was reached with moderate Democratic Sens. Joe Manchin (WV) and then Kyrsten Sinema (AZ). No Republicans voted in favor of the plan.

Part of the challenge for the president is to maintain his oft-stated campaign pledge of no tax increases for Americans making less than $400,000 per year.

That is a promise many experts note has already flown out of the window. The Joint Committee on Taxation reports that even taxpayers earning less than $10,000 per year will see a 0.3% hike beginning next year.

And for those earning under $200,000, taxes go up in 2023 by an estimated $16.7 billion. Neal’s pledge for new individual and corporate taxes falls right in line with the president’s pattern. Promise one thing and then do something else — denying all the while that a promise was broken.