Biden’s proposing tax cuts – increases would be miniscule

If you look only at Biden’s proposed changes in direct taxes on households, including individual income taxes, payroll taxes, and estate taxes, the average tax increase falls by more than half, to about $1,100. Low- and moderate-income households would get slightly larger tax cuts and very high-income households would face a smaller tax hike than with all tax changes. This calculation excludes corporate tax increases, which TPC assumes indirectly affect workers and shareholders by lowering their future wages and investment income.

Biden’s Pledge

Since his 2020 presidential campaign, Biden has insisted he would not raise taxes for households making $400,000 or less. His changes in direct taxes largely achieve that goal, though a very small fraction of households making less than that threshold would pay more. If all of his proposed tax changes are included, he’d fall short, though Biden never made clear exactly which was his goal.

Note that TPC looked at incomes above and below about $410,000 since that reflects the 95th income percentile. But households making $400,000 are very similar to those with incomes of $410,000.

The picture is roughly the same in 2026, after many individual provisions of the 2017 Tax Cuts and Jobs Act (TCJA) are scheduled to expire. However, average tax hikes for high-income households would be somewhat smaller while low-and moderate-income households would pay a bit more in 2026 than in 2024. Keep in mind that Biden and congressional Republicans say they want to extend at least some of those TCJA tax cuts, though his budget did not do so.