During his State of the Union address, President Joe Biden outlined his intentions to increase taxes on wealthy Americans and large corporations. This plan, which will be detailed in the upcoming fiscal 2025 budget proposal, aims to reduce the federal deficit by $3 trillion over the next decade. Additionally, it seeks to provide tax relief for low-income families and support for middle-class homebuyers.

A key feature of Biden’s plan is a new tax credit designed to assist Americans in buying their first homes or upgrading to larger ones. This credit would effectively provide $400 monthly for two years to counteract high mortgage rates. Furthermore, Biden proposed eliminating title insurance costs on refinancings of federally backed mortgages, potentially saving homeowners over $1,000.

These tax initiatives are expected to be central to Biden’s re-election campaign, positioning him against former President Donald Trump, whose 2017 tax law reduced taxes for corporations, the wealthy, and many middle-class citizens. I’m a capitalist,” Biden stated, emphasizing the importance of the wealthy paying their fair share of taxes and criticizing the Trump-era tax cuts for increasing the federal deficit.

Most of Biden’s tax proposals hinge on the Democrats gaining significant majorities in both Congressional chambers, a prospect currently deemed unlikely by polls. The President reiterated his call for a rise in the corporate income tax rate from 21% to 28% and suggested increasing the minimum corporate tax to at least 21%. This tax, which was introduced in the 2022 clean energy legislation, applies to companies reporting over $1 billion in profits. Additionally, Biden intends to quadruple the 1% tax on corporate stock buybacks