- President Joe Biden has repeatedly promised that he won’t raise taxes on those earning less than $400,000 annually.
- But people in married couples each earning less than $400,000 may have to pay more under Biden’s tax changes, Axios reported.
- A White House official said Biden would increase the income-tax rate for families earning more than $509,300.
- See more stories on Insider’s business page.
Some Americans earning less than $400,000 will have to pay higher tax rates under President Joe Biden’s economic plan, a White House official told Axios on Wednesday.
In May 2020, Biden said that “nobody making under $400,000 would have their taxes raised” during his administration. But the White House official said people in married couples earning less than $400,000, filing jointly, may have to pay higher taxes.
The President plans to increase the income-tax rate from 37% to 39.6% for families earning more than $509,300, and for individuals above $452,700, the official said.
This means that a married couple each earning more than $255,000 would have to pay the higher tax rate on part of their income, because their combined income exceeds $509,300.
Biden is raising taxes on the very wealthy to pay for his $1.8 trillion spending plan to extend cash payments for parents, set up universal pre-K, and free community college.
“Consistent with the president’s campaign proposal, we are proposing to reverse the tax cut for the top bracket by returning that top tax bracket to what it would’ve been under pre-2017 law,” the White House official told Axios. “That applies to less than 1% of Americans – the very top earners.”
“In 2022, those pre-2017 brackets are expected to be about $452,700 in taxable income for a single individual and $509,300 in taxable income for a married couple,” they said.
Biden has repeatedly promised that he would raise taxes on the wealthy, but not on people earning less than $400,000 annually. “Nobody making under $400,000 would have their taxes raised. Period, bingo,” Biden said in an interview on CNBC in May 2020.
In March 2021, in a speech unveiling the American Jobs Plan, he said “no one, let me say it again, no one making under $400,000 will see their federal taxes go up, period.”