Biden’s 2025 budget calls for taxing the rich and corporations

President Joe Biden‘s 2025 funding proposal released Monday repackaged his tax hike proposals on billionaires and corporations and many other requests from his 2024 budget, which is still under negotiation on Capitol Hill halfway into the fiscal year.

Like all presidential budgets, Biden’s 2025 plan is more of a wish list than it is a policy document.

Biden’s budget comes in at $7.3 trillion in spending proposals, up from $6.9 trillion in 2024 though the two proposals include mirroring requests for boosts to Social Security, Medicare and tax hikes for the wealthy.

This year, as the president faces a likely general election rematch against Donald Trump in November, his budget is also a statement of the Biden campaign’s economic platform.

Trump on Monday morning suggested cutting entitlement programs like Social Security, Medicare and Medicaid in a CNBC interview.

“There is a lot you can do in terms of entitlements in terms of cutting and in terms of also the theft and the bad management of entitlements,” Trump said on CNBC’s “Squawk Box.”

Biden has repeatedly fired back at the comment in the hours since.

“Even this morning, Donald Trump said cuts to Social Security and Medicare are on the table again,” Biden said at a speech in New Hampshire following the budget proposal’s release. “I’m never going to allow that to happen.”

Taxing the rich

According to the White House, the budget aims to reduce the federal deficit by $3 trillion over the next 10 years largely by imposing a minimum 25% tax rate on the unrealized income of the very wealthiest households and by reshaping the corporate tax code. Biden’s budget would raise taxes for billion-dollar companies from 15% to 21% and hike the broader corporate tax rate to 28%.

“We can do all of our investments by asking those in the top 1 and 2% to pay more into the system,” Shalanda Young, director of the White House Office of Management and Budget, said on a call with reporters Monday.

Biden will also seek to shore up Medicare and Social Security, in part by relying on new, federal negotiating powers for Medicare prescription drugs and by seeking other savings in housing, health insurance and more.

Biden previewed many of the themes of his budget blueprint in his State of the Union address Thursday.

“Do you really think the wealthy and big corporations need another $2 trillion in tax breaks? I sure don’t. I’m going to keep fighting like hell to make it fair!” he said in a fiery, partisan speech before Congress.

Biden’s populist, progressive, tax-the-rich funding plan is not a novel proposal from his White House.

Since he took office in 2021, Biden and congressional Democrats have repeatedly proposed increasing taxes on the very wealthiest to raise revenue. But the idea made very little headway even when Democrats controlled both houses of Congress.

After Republicans assumed the House majority in 2023, the billionaire tax plans were put on ice indefinitely.

House Republicans tried to preempt Biden’s budget proposal last week by passing their own 2025 budget resolution in a party-line committee vote. That proposal would aim to reduce the ballooning federal deficit by some $14 trillion over the next decade, in part by dismantling Biden’s landmark Inflation Reduction Act, which has provided massive investments in clean energy and the green economy.

“Congressional Republicans give their top lines, which have rosy economic projections that don’t fit reality,” Young said Monday. “Congressional Republicans don’t tell you what they cut, who they harm.”

House Republican leaders, including Speaker Mike Johnson, R-La., on Monday slammed Biden’s budget request, calling it “a roadmap to accelerate America’s decline.”

“The price tag of President Biden’s proposed budget is yet another glaring reminder of this Administration’s insatiable appetite for reckless spending and the Democrats’ disregard for fiscal responsibility,” Johnson and his House Republican colleagues wrote in a statement.

2024 budget still unfinished

The two competing budget proposals are no surprise in a deeply divided Washington, one where compromise has been a rare commodity during 2024.

Back-and-forth disagreements in Congress have meant that six months into the fiscal year, lawmakers have still not settled on a permanent budget.

Over the past six months, fierce battles in Congress led to several near government shutdowns, and cost former Republican House Speaker Kevin McCarthy his job.

In the meantime, the government was keeping the lights on via temporary spending bills.

Finally, in late February, lawmakers struck a deal on a $460 billion bill to fund half of the government for the rest of the fiscal year. Funding for the other half must be settled by March 22 or the government will go into partial shutdown.

Despite that dysfunction, Biden did not dilute any part of his progressive budget requests for 2025, though that may have made it easier for the polarized Congress to swallow.

Eyes on November

This year, the budget also represents Biden’s economic platform for his reelection campaign. As the president pursues his reelection bid, there are no signs of softening his pressure campaign against wealthy interests.

“Republicans will cut Social Security and give more tax cuts to the wealthy,” Biden declared in his State of the Union address Thursday. “I will protect and strengthen Social Security and make the wealthy pay their fair share!”

Voter sentiments about Biden’s economy may be starting to brighten after months of gloomy approval ratings, according to recent polls.

In a Wall Street Journal survey taken in February, Biden received his highest grade on the economy during the campaign so far. Forty percent of voters approved of his handling of the economy, a 4-point increase from the same question in December.

Still, Biden needs to catch up to compete with voter perceptions of what Trump’s economy was like.

In a CBS/YouGov poll also taken in February, 55% of survey respondents said Biden’s policies would make prices more expensive while only 34% said the same of Trump’s policies.

Meanwhile, Biden’s reelection campaign is working to try and convince voters that post-pandemic jumps in the cost of living are, in fact, merely a product of unfair corporate pricing tactics, the same ones that the Biden administration has been cracking down on in the past year.

Last week, Biden announced the launch of a “Strike Force on Unfair and Illegal Pricing,” a group that will be jointly led by the Federal Trade Commission and the Department of Justice. Its goal is to put pressure on companies to lower prices.

“President Biden is fed up with corporate practices that unfairly raise costs for consumers,” National Economic Council Director Lael Brainard told reporters last week. “And he’s taking action.”