Senate Minority Leader Mitch McConnell weighed in on Democrats' plan to fund their scaled-down social spending bill using a billionaires' tax, calling the proposal a "harebrained scheme."
In a statement on Monday, McConnell expressed his disagreement with the idea, arguing that having the Internal Revenue Service (IRS) penalize people who "invested wisely" and compensating people who "invested poorly" was poor judgment.
Mitch McConnell on Billionaires' Tax
The proposal that the official was criticizing was Senate Finance Committee Chair Ron Wyden's recent billionaires' tax that would impose annual taxes based on the increased value of assets of wealthy people. This includes assets that are not sold or "realized" because such things as stocks are only taxed when they are sold. This incentivizes people to keep them long-term and pass them onto the next generation.
It was previously reported that Wyden's proposal was different from Sen. Elizabeth Warren's ultramillionaire tax, which aimed to place a 2% on household net worth between $50 million and $1 billion. It also includes a 3% tax on household net worth over $1 billion. Previously, United States President Joe Biden indicated his support for Wyden's proposed bill, Business Insider reported.
McConnell's comments come as Democrats assert that they are getting closer to an agreement on the reconciliation measure that would address some of Biden's top priorities. The list includes climate change and the expansion of social programs. Democratic leaders are optimistic about seeing a vote on the not-yet-completed measure in the coming weeks.
In his statement, the Senate minority leader said that the far left officials were controlling the entire country and are proposing a new "craziness" into the mix. He argued that Democrats were so desperate to raise taxes that they planned to tax money that U.S. residents have not even earned yet.
"Let me say that again. They're now proposing to tax money the American people haven't made yet. Yes, you heard me right. So much for the quaint idea that you had to actually make money first before the IRS could tax it, now Democrats want to tax money you haven't made yet," McConnell said, the New York Post reported.
Massive Spending Plan
U.S. President Biden and Democratic congressional leaders on Monday raced to strike a compromise regarding a domestic policy and climate package. The proposal would start its vote within days despite critical disagreements between lawmakers regarding health benefits, paid leave, environmental provisions, and how to pay for the plan remain.
Negotiators said they were nearing an agreement regarding the plan that could have a funding of $1.75 trillion over 10 years. The massive bill would be half the size of the blueprint that Democrats approved earlier this year. The plan includes an extension of monthly payments to families with children known as the Advanced Child Tax Credit.
The proposal would also establish generous tax incentives for clean energy use and provide federal support for child care, elder care, and universal prekindergarten. The bill also includes several tax increases, including the billionaires' tax, which would help pay for the initiatives, the New York Times reported.
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