Senate Democrats are proposing new tax increase measures to offset the cost of “Build Back Better” reconciliation legislation in response to objections from Senator Krysten Sinema (D-AZ) to increasing the marginal tax rates for corporate, individual, and capital gains income.
A 15% minimum tax on the financial statement (“book”) profits of corporations that report over $1 billion in profits to shareholders has been proposed by Senate Finance Committee Chairman Ron Wyden (D-OR), Senator Elizabeth Warren (D-MA), and Senator Angus King (I-ME). The proposal would be effective for tax years beginning after 31 December 2022.
An annual mark-to-market tax on unrealized capital gains for tradable assets also has been proposed by Chairman Wyden for individuals with more than $1 billion in assets for three consecutive years, or who earn more than $100 million for each of three consecutive years.
Significant tax increase proposals affecting businesses and individuals soon may be put to votes in the House and Senate with limited opportunity for public input. Stakeholders, and especially CEOs and CFOs, should communicate with policy makers on the potential effects of tax increase proposals on their employees, job creation, and investments in the United States.
