The next president will face a massive challenge in the area of tax policy next year, as lawmakers battle over the expiration of some key elements of the 2017 Republican tax cuts, including tax breaks for individuals.
CNBC’s Kate Dore notes that while presumptive Democratic nominee Kamala Harris hasn’t released her own policy proposals, there’s good reason to think she will hew closely to the plans already provided by President Joe Biden.
Garrett Watson, a policy analyst at the conservative Tax Foundation, told Dore that he expects Harris to adopt the basic outline of Biden’s plan, which emphasizes higher taxes on the rich and corporations, as well as more generous childcare benefits for most families. In addition to likely agreeing with those ideas, Harris may lack sufficient time and resources to develop alternatives, Watson said, since she is inheriting the existing Biden campaign and policy infrastructure so close to the election.
Still, a look at Harris’s past proposal suggests that she could lean into more progressive tax policies than Biden. The New York Times’s Alan Rappeport notes that in 2019, Harris proposed to provide a tax credit worth up to $500 a month for those earning less than $100,000 a year, as a way to make up for the expiration of tax cuts for individuals in the 2017 tax law. She also proposed raising the estate tax to help pay for salary raises for teachers and increasing the corporate tax rate from 21% to 35%.
One key issue to look out for is whether Harris adopts Biden’s view that taxes should not be raised for households earning less than $400,000 a year. “That’s a big one with significant consequences” for Democrats as they produce more detailed tax proposals in negotiations next year, Andrew Lautz of the centrist Bipartisan Policy Center told Dore.
