ICYMI: Bloomberg: US Tax Bill Costs Corporations Nearly $300 Billion More, While Middle Class Pays Less

FOR IMMEDIATE RELEASE: August 9, 2022
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ICYMI: BLOOMBERG: US TAX BILL COSTS CORPORATIONS NEARLY $300 BILLION MORE, WHILE MIDDLE CLASS PAYS LESS

Key Excerpt: “Corporations will pay nearly $296 billion more in US federal taxes over the next decade, and middle-income households will see some tax cuts, under the tax-and-climate bill that is likely to become law in the coming days.”

Bloomberg: US Tax Bill Costs Corporations Nearly $300 Billion More, While Middle Class Pays Less
Laura Davison
August 9, 2022

Corporations will pay nearly $296 billion more in US federal taxes over the next decade, and middle-income households will see some tax cuts, under the tax-and-climate bill that is likely to become law in the coming days.

That’s the takeaway from analysis released Tuesday by the Congressional Joint Committee on Taxation.

About $222.2 billion of the increase on businesses will come from a new corporate minimum tax that requires companies with at least $1 billion in profits to pay a minimum of 15% on the earnings they report to shareholders. An additional $73.7 billion stems from a 1% excise tax on corporations that buy back their own stock, the projections from the nonpartisan scorekeeper showed.

Households earning less than $100,000 will see net tax cuts through 2025, largely due to an extension of subsidies for Affordable Care Act premiums. After that, taxes for middle- and low-income households are largely unchanged. The bill also includes some tax incentives for electric cars and home-energy efficiency — contributing to the decrease in tax burden.

Taxpayers earning at least $500,000, a group that’s more likely to own stocks, will see their taxes go up by about 1% next year, reflecting indirect tax increases tied to the corporate-tax hikes. While the legislation doesn’t include any direct tax increases on high-earners, the Joint Committee on Taxation’s model directs some of the corporate-tax burden on shareholders.

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