CNBC addressed Biden’s tax plan in a story on April 28 by Lorie Konish which said that Biden’s tax proposal will keep his campaign promise of no tax increases for anyone making $400,000 or less.
However, they note that the reasons for choosing $400,000 as a line demarcating the rich from lower and middle earners aren’t entirely clear, since the number doesn’t precisely match household tax statistics.
“It is an arbitrary threshold,” according to Leonard Burman, who co-founded the Tax Policy Center, a joint project of the Brookings Institute and the Urban Institute. “There’s no analytical justification for it.”
The IRS does not use a $400,000 threshold but uses a $500,000 break-point. IRS data shows that Americans with $500,000 or more income represent the top 1.1 percent of tax filers.
So it is interesting to explore where Biden came up with a $400,000 threshold and his promise that those earning $400,000 or less will not pay a penny more. He first proposed the $400,000 threshold while he was a Presidential candidate.
The Washington Post fact-checked Biden’s claim: “Nobody making under 400,000 bucks would have their taxes raised, period, bingo.”
Claimed by: Joe Biden
Fact check by The Washington Post: Accurate
I decided to do my own fact-checking on why Joe Biden chose $400,000 as the threshold for no tax increases; particularly since the IRS standard seems to be $500,000. On a hunch I googled. “US President’s salary.” And to my great (non-surprise), the answer came back as $400,000. I did get one surprise when Google told me that the President receives the $400,000 yearly salary for life.
Mystery solved. Joe Biden promises to “tax the rich,” but conveniently selects his own salary as the threshold between the non-rich and the rich and as the threshold for no new taxes.