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The American families plan by Biden will raise the income tax rate paid by wealthy Americans to 39.6% from 37%.
President Joe Biden is set to propose a $1.8 trillion new economic spending program on Wednesday evening. According to a senior government official, the current administration is compelled to take extra measures to help vulnerable citizens as the economy rebounds from the Covid pandemic. “These are investments that we can’t afford not to make as a country,” a senior administration official said Tuesday night in a conference call with reporters.
This comes a few months after successfully rolling out the American Rescue Plan Act of 2021. Besides, Biden’s administration previously revealed details of more than $2 trillion infrastructure and economic recovery package earlier this month.
Through a comprehensive and all-inclusive economic stimulus package, President Biden aims to revitalize the American economy as promised during his campaigns. The proposed $1.8 trillion American families plan is set to be fully offset in 15 years, partly by raising the amount of taxes paid by wealthy Americans, particularly anyone who earns more than $1 million annually.
Notably, the American families plan by Biden will raise the income tax rate paid by wealthy Americans to 39.6% from 37%. However, the plan noted that no one who makes $400,000 or less in a year will see their tax rate raised.
Details of the American Families Plan Proposed by Biden
The proposed package will set aside $225 billion toward high-quality childcare. Whereby it will ensure families pay only a portion of their income toward childcare services, based on a sliding scale.
Notably, $225 billion is set to go to create a national comprehensive paid family and medical leave program. Further, $200 billion will go towards free universal pre-school for all three- and four-year-olds in partnership with the state governments.
University students will significantly benefit from the proposed American family $1.8 trillion plan. Notably, approximately $109 billion will be used towards ensuring two years of free community college for all students. Moreover, approximately 85 billion will go towards Pell Grants, whereby it is expected to be increased to $1,400 for low-income students. Further, the bill proposed that $62 billion will go towards a grant program to increase college retention and completion rates.
Notably, the plan has set aside $39 billion for a program that enables up to two years of subsidized tuition for students from families earning less than $125,000 in a year and are enrolled in a four-year historically black college or university, tribal college or university, or minority-serving institution.
The plan has also set aside $200 billion towards making permanent the prior proposed low health insurance premiums.