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During his acceptance speech on the fourth night of the Republican National Convention, the president claimed Biden’s “$4 trillion tax hike” proposal – which centers on raising taxes on people earning more than $400,000 – would “collapse” the U.S. economy and raise rates on nearly all households.
“On the other hand, just as I did in my first term, I will cut taxes even further for hardworking moms and dads, I will not raise taxes,” Trump said.
Trump specifically said he will provide tax credits to companies that bring jobs back to the U.S. from other countries and impose tariffs on businesses that ship jobs overseas.
There are a number of tax cuts that the administration is considering, as highlighted by White House economic adviser Larry Kudlow earlier this week.
Trump issued an executive action for a payroll tax deferral – scheduled to begin next month – which he intends to turn into a permanent cut by forgiving deferred payments next year.
Further middle-class income tax cuts have been discussed by the administration — Kudlow has mentioned a 15% tax rate for the middle class. Trump has also been open about his desire to reduce capital gains taxes, which are paid on the difference between what an individual originally paid for a property or investment vs. what it sells for at the time it is sold.
The current top capital gains rate sits at 23.8%. Trump has said he would consider a rate as low as 15%.
Kudlow also suggested Biden would have to raise rates on the middle class to pay for his spending agenda, because his plans just don’t “add up.”
Biden’s plan does involve raising personal income rates on the wealthy, in addition to raising the corporate tax rate. He would also tax capital gains at the same rate as ordinary income, while lowering the basic exclusion amount for the estate tax.