Since the advent of President Biden, the curiosity of the public of witnessing major reforms in U.S. federal laws was on the heat. With the introduction of Proposed Tax Law changes, 2021, it becomes quite important to have an overview of what new has this government brought for the welfare of the public. The changes are not yet effective and but can be in action from January 1, 2022. Before beginning with the summary, you must know that these changes are still holding the status of the proposal and are subject to approval from Congress. Only after Congress passes it, the Biden administration can work in furtherance of it.
Proposed Tax Law Changes, 2021 at a Glanceby William D King–
- Eliminating the existing incentives for fossil fuels-
This move is being appreciated worldwide because fossil fuels are on the verge of exhaustion. By eliminating the incentives provided to companies using fossil fuels, they will be bound to opt for alternative energies. This is not only going to have a very positive impact on the environment but also the revenue generated by other sources of energy will also increase.
- Enhancement in corporate tax-
In the present bill, the Biden administration has backed the idea of enhancing the tax amount imposed on corporate. Claiming to show positive outcomes, in the long run,the tax amount is can rise from 21% to the now standing 28%.
- Increase in funding-
Proposed Tax Law Changes, 2021 aims to increase funding to IRS. This move is important to smoothly run the audits and tax enforcement.
- Boost Capital Gain Rates-
The taxpayers whose income exceeds $1 million are expected to contribute to the federal reserve. The government is trying to witness an increase in long-term capital gains and qualified dividends. Therefore, people who are making money and exceeding the golden mark of $1 million must be ready to release more tax up to approximately 39.6 %.
- Green Book-
The U.S. Department of the Treasury has introduced the concept of the Green Book. This book contains general explanations of the Biden Administration’s Fiscal Year 2022 Revenue Proposals. However, this is subject to approval by Congress. Hence, we cannot make firm opinions about its contents because it is not going to be exactly what Biden is offering but what Congress and Republicans decide to offer altogether. But speaking in a broader sense, this book is expected to offer worthy information for the public. It is going to connect the general public to the complicated financial machinery. The families who are looking up to the proposed law changes as an opportunity to invest will appreciate this move for sure.
Apart from the above major points, William D King also suggests that there are many other small changes made in the new legislation. However, the final bill can only be disclosed after a successful negotiation between Congress and Republicans. But one thing is sure that these changes even if implemented partially are going to bring storm in the market worldwide. Therefore, not only the big brands and MNCs but the common public must prepare itself and start reviewing their planning today.