President Joe Biden's $7.3 trillion fiscal 2025 budget proposal lays out a second-term vision that would deliver more services, middle-class tax breaks and price controls to voters funded through higher taxes on the wealthy and corporations.
The document, unveiled Monday, details Biden's opening salvo in his reelection battle with former President Donald Trump — building on the State of the Union address he delivered Thursday. Little of the budget stands a chance of becoming law in a divided Congress.
Under the proposal, some homeowners would receive monthly tax credits to offset high mortgage rates, parents would receive subsidies for child care, and the government would use new powers to lower prescription drug prices.
Those programs would be offset by sweeping changes to the tax code, including a hike in corporate taxes and a new minimum rate to be paid by billionaires and larger companies.
The plan is aimed at enticing voters, even as the rising deficits in the budget risk fueling attacks by Republicans. Convincing skeptical Americans to back his agenda is crucial ahead of November's election and into 2025, where the calendar will be dominated by debates over the debt ceiling and Trump's expiring tax cuts.
The president would spend $1.671 trillion in so-called discretionary spending — areas that aren't linked with mandatory programs like Social Security — seeking $895 billion for base defense-related programs and $621 billion for domestic spending.
The non-emergency funding increases 1.6% in line with budget cap agreements struck with Congress.
Biden also proposes increasing the Justice Department's antitrust budget by $63 million ahead of a potential flurry of cases affecting tech giants. Lawmakers last week changed that office's ability to access premerger fees.
The proposal is designed to give Biden leverage as he battles to ensure full funding of the government and secure assistance for Ukraine and Israel. Biden will travel to New Hampshire later Monday to discuss his vision, with trips to Michigan and Wisconsin slated for later this week.
"While my administration has seen great progress since day one, there is still work to do," Biden said in a letter to lawmakers sent with the request. "My budget will help make that promise real."
Here are key takeaways:
Taxes
Those with incomes under $400,000 wouldn't see an increase in their federal payments and would benefit from a series of proposed credits.
Biden has proposed giving homeowners $400 a month for the next two years to offset high mortgage rates, making permanent a subsidy for those purchasing their own health care and fully restoring a pandemic-era child tax credit for a year.
Those costly programs would be offset by raising the corporate tax rate from 21% to 28%, setting a minimum corporate tax rate at 21% for corporations valued at $1 billion or more and quadrupling the tax companies must pay for stock buybacks.
Biden would also increase the cap on payroll taxes to boost Social Security.
Biden imposes a minimum tax on billionaires — including on unrealized capital gains — of 25%, which would bring in an estimated $500 billion in tax revenue over the next decade. He is proposing taxing capital gains at the same rate as wages for those making more than $1 million.
Biden also renews his call for Congress to end some $35.3 billion worth of tax incentives cherished by the oil and gas industry.
