Kudlow: Biden’s $3T tax hike will ‘decimate the economy’
FOX Business’ Larry Kudlow discusses the Biden administration’s plans to increase taxes on the wealthy, and its potential impact on the economy.
'Kudlow' host Larry Kudlow tells FOX Business' "Varney & Co." that President Biden's plan to increase taxes in order to fund more government spending makes 'no sense at all' and will hurt the economy.
BIDEN'S TAX-HIKE PLAN FACES OPPOSITION FROM MODERATE DEMOCRATS
LARRY KUDLOW: I don't know that it's going to happen. It might happen. But you're absolutely right. This is a payoff to big blue state Democrats, wealthy Democrats. You know, it's so hypocritical here. Obviously, the Democrats say, well, we have too many tax cuts for the rich and the rich don't pay their fair share. Right. So they're going to roll out some kind of crazy three trillion dollar tax hike, which will absolutely decimate the economy next year and the years ahead if it gets through. But at the same time, they're going to put in a little vigorish…for their donors so that, in a few states like New York and New Jersey and California, maybe Illinois, they can deduct state and local taxes. That's just terrible tax policy. We should keep the SALT deduction. We should eliminate it all together, in my judgment, and then just lower marginal tax rates for everybody across the board. This SALT thing…why should federal taxpayers in the Midwest or the far West or the Sunbelt have to finance the excessive spending and taxing of New York State and New Jersey and California makes no sense at all.
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Well, look, again, I don't know how this outcome is going to be, there's going to be tremendous Republican opposition to that. I mean, we had Mark Meadows, former Chief of Staff, on yesterday talking about this. There's a whole new group, coalition group, Mark Short, who was the Vice President, Pence's top staff guys, organizing one. There's going to be tremendous opposition. Mitch McConnell says he's going to oppose all this stuff. So we'll see what the outcome is. I mean, look, let's take the corporate tax rate. It turns out that the corporate tax rate, the biggest benefits, went to the middle income people. Family of four, typical family of four, got a $6,500 increase after tax and family income. That is massive. That was obviously pre-pandemic in 2018 and 2019. Now, China will have a lower corporate tax rate than the United States will. China is at twenty-five. We're now at twenty-one. We should go to fifteen. You're going to put it up to twenty-eight. Well, guess what? Companies, factories, cash – going to move offshore. Inversions are going to come back. Exactly the stuff we did not want. How about doubling the capital gains tax. Stu, that is completely anti-investment..
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Democrats are saying, well, we need higher taxes to finance whatever three-trillion-dollar infrastructure bill and so forth. Well, the infrastructure bill is going to be less of that infrastructure than it is going to be about the Green New Deal to abolish fossil fuel energies, which would be a calamity. Second, it's an excuse to tax the rich. We're talking here, class warfare, not growth. The left, left, left of the progressive movement doesn't care a whit about economic growth. They just have an ideology of redistribution of income. Go after tax cuts. It's right after Karl Marx, Das Kapital. I was there when he finished that book in 1967. I told him not to do it, that his numbers were no good and he ignored me completely. And it's probably become the world's greatest seller, certainly among left-wing people. But in all seriousness, who would raise taxes three trillion dollars? Who would make us less competitive in the name of taxing the rich? All this is, is, you know, some socialist ideology…and I think it can be stopped. I think you're going to find Democrats in the House and Senate who really don't like this.
You know what? Even socialists run out of other people's money. Remember that."
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