Closed Tax Loophole Could Raise Enough Cash For Everyone to Get Two More Stimulus Checks
Alongside the $3.5 trillion budget proposal are a whole bunch of new tax laws.
The past year and a half have been challenging for families, but the federal government has stepped up in a way that has never been seen before — namely, through providing direct cash to Americans through stimulus checks and, for parents, monthly child tax credit payments. These combined programs, alongside extended and beefed-up unemployment benefits, have had an incredible effect on people in the country, lowering poverty, helping people stay in their homes, and even reducing hunger.
Several studies have confirmed this — including research that has shown that the pandemic stimulus checks have been helpful in particular, not just financially but also in terms of mental health. several studies have shown. And a new tax law rewrite has the potential to raise enough money for every American to get two more stimulus checks. If the government decided to simply just give people cash, that is. (And in this case, it’s extremely unlikely.)
The House voted to advance a $3.5 trillion budget blueprint, otherwise known as the “human infrastructure plan,” recently — and new tax law has been floated in order to figure out how to “pay for it.” per Business Insider.
A not insignificant part of the budget will be paid for through a collection of tax hikes that will hit the most prominent companies and the wealthiest Americans. One part of that? The corporate tax rate.
“President Biden proposed a 28 percent corporate rate, higher than the current 21 percent level,” Business Insider reports. And if this is the route they go, this would “partially roll back” the 2017 tax law enacted by President Donald Trump that gave corporations major tax loopholes.
“A part of that 2017 law includes how the government taxes US-based multinational firms depending on the location of their headquarters and where they earn profits,” Business Insider explains. And it’s this that the Democrats hope to overhaul in their tax law rewrites to help raise enough money to pay for tuition-free community college, child allowance, and universal pre-kindergarten, among others. And it could unlock a whole lot of money.
As Kyle Pomerleau, a tax expert at American Enterprise Institute, told NBC News, these proposed tax changes could raise $800 billion, or enough money “for the federal government to finance two $1,400 stimulus checks similar to the ones most Americans received in the $1.9 trillion Biden stimulus law during the pandemic,” Business Insider points out.
Obviously, that’s not going to happen. The several-trillion budget is set to provide paid family and medical leave to every worker, universal and affordable child care, free pre-k for kids, free community college, a five-year extension of the monthly child tax credit payments, and more. These benefits all kick butt, and in many ways people will get more cash from them than the stimulus checks, so it’s more than a fair trade.