Biden unveils massive $7.3T budget with $5.5T in tax hikes post-State of the Union address

President Biden unveiled his election-year budget pitch Monday, calling for $5.5 trillion in tax increases by raising rates on the wealthy and corporations — while driving up spending on federal benefit programs, affordable housing and student debt cancellation, among other proposals.

The fiscal year 2025 budget — which is highly unlikely to be approved by Congress — matches last year’s topline tax increase level and would achieve the massive investments while purportedly cutting the federal deficit by $3 trillion over the next 10 years, the White House said on Monday.

Brian Riedl, a senior fellow at the Manhattan Institute focusing on the budget and taxes, told The Post in a Friday interview that Biden’s similar plan from last year put forward “the highest peacetime burden in American history, as well as the highest sustained taxes in American history.”

“Not only is the president raising taxes, but he’s using a substantial portion of it for new spending rather than deficit reduction, which just means even bigger tax hikes down the road when it’s time to rein in the deficit,” Riedl said.

The White House has attacked congressional Republicans for supporting the 2017 Tax Cuts and Jobs Act under President Donald Trump, which it faulted for including “giveaways” to “wealthy and corporate tax cheats.”

Biden, 81, floated some of his budget proposals during Thursday night’s State of the Union address, including raising the income tax rate for corporations to 28% and bringing the minimum corporate tax rate from 15% up to 21%.

He also called for more than $400 monthly in mortgage rate tax credits and a 25% tax on billionaires — defined as those with a net worth of $100 million or greater.

“You know, there are 1,000 billionaires in America. You know what the average federal tax is for these billionaires? They are making great sacrifices: 8.2%,” Biden said mockingly, adding that his tax hike would “raise $500 billion over the next 10 years.”

“Under my plan nobody earning less than $400,000 a year will pay an additional penny in federal taxes,” he added. “Nobody. Not one penny. And they haven’t yet.”

Riedl said that claim has been “widely debunked” and argued the 8% tax rate was “essentially made up by White House economists.”

“They do not count the corporate and estate taxes paid by the wealthy, but they also expand their income to include all sorts of things like unrealized capital gains that will be taxed in a future year,” Riedl said.

“America has the most progressive tax code in the entire [Organization for Economic Co-operation and Development] and billionaires do not pay an 8% tax rate.”

The president’s budget also touts an unprecedented $258 billion investment in affordable housing and up to $10,000 in new tax credits for first-time homebuyers.

“The tax credit just responds to rising housing prices by subsidizing demand even more, which will just further raise housing prices and negate much of these savings for families,” Riedl said of the provision.

Another line item touts the restoration of the full child tax credit of up to $3,600 as enacted in Biden’s American Rescue Plan, as well as other tax cuts for middle- and low-income Americans amounting to $765 billion over the next decade.

The budget would add $8.5 billion for federal food benefit programs, most of which would go to the Special Supplemental Nutrition Program for Women, Infants and Children (WIC), 

After having already canceled $137 billion in student loan debt for 3.7 million borrowers, the budget further proposes $12 billion for reducing the costs of college, eliminating origination fees on student loans and tucking other student debt cancellation measures into a $3.7 billion state and local safety proposal.

Tens of billions more would also be invested in veterans’ benefit programs and plans to hire and retain educators and support students in schools nationwide four years after the start of the COVID-19 pandemic.

Another $2.7 billion would be set aside for the Office of Federal Student Aid to support student borrowers.

Before Biden’s address to Congress, House Budget Committee chairman Jodey Arrington (R-Texas) released a budget resolution to reduce deficits by $14.2 trillion and add a budget surplus of $45 billion.

“At a time when the state of our union is in sharp decline, President Biden has proven he is unwilling to make the tough decisions to confront the reality of our nation’s unbalanced budget and weak economy,” House Speaker Mike Johnson (R-La.) said in a statement about the proposal.

“The reckless spending and economic damage done by this Administration and years of Democrats’ control has increased everyday costs for the American people.”