President Joe Biden on 28 March sent to Congress a $5.8 trillion FY 2023 budget that proposes new tax increases, including a new 20% minimum tax that would apply to certain high-income individuals, and other measures to reduce federal deficits by $1 trillion over 10 years. New business tax increase proposals include an “undertaxed profits rule” that would replace the current base erosion anti-abuse tax (BEAT). The President’s budget also re-proposes a 28% corporate income tax rate and numerous other tax provisions that were included in his FY 2022 budget.
The release of the President’s FY 2023 budget and a 120-page Treasury Department “General Explanation of the Administration’s FY 2023 Revenue Proposals” (the Green Book) comes at a time when Senate Democrats are attempting to advance the “Build Back Better” reconciliation bill (H.R. 5376) that passed the House with only Democratic votes last November. The House-passed reconciliation bill has been stalled in the Senate due to objections from Senator Joe Manchin (D-WV) over the legislation’s spending provisions and other issues.