The current administration has stated that those earning less than $400,000 per year will not face any tax increases. However, President Biden’s economic proposal for a $3.5 trillion spending package will have a significant tax and fee impact on those earning less than the top 1.8 percent of income. Though they claim that enhanced taxes will be levied only on the rich but it is clear that every American will face the consequences including working families and small businesses. Blaming inflation for hitting our saving is not justice but there are several other reasons.
The Biden Administration will enact a new tax known as “The Carbon Tax” in order to achieve the long-term goal of 100 percent carbon-free electricity by 2035 and zero-sum greenhouse gas emissions by 2050. Such taxes may be imposed on countries that do not work to reduce greenhouse gas emissions. If the greenhouse gas reduction target makes cooking and eating more expensive, the consequences will be felt across the country.
“The White House is concerned about the inconsistency between Biden’s promise to protect those earning less than $400,000 per year from tax increases and the Democrats’ proposal to boost consumer goods of everyday consumption,” according to the White House.
According to economic analysis, raising the natural gas tax will result in a $9 billion reduction in GDP, which directly translates to the loss of 90,000 jobs.
Even Senate Democrats believe that the tax will disproportionately affect lower-income Americans and that no amount of compensation, whether in the form of a rebate or direct relief, will suffice to compensate these taxpayers.
Plastic Excise Tax
The administration has stated that they intend to impose a plastic tax, which would entail a $.20 per pound fee on the sale of virgin plastic. This type of tax will directly affect consumers, who will pay higher prices than usual for everyday household items.
The decision will have a huge impact on big businesses. As they pay higher prices for their manufacturing items, the increase in manufactured items will be adjusted, and the tax burden will eventually be shifted to consumers. Americans are already paying higher prices, with the highest prices since the Great Recession.
CNBC’s host of Mad Money, Jim Cramer, currently made the headlines by stating that:
“Gold has a scarcity value that has been established overtime… In my opinion, gold is an excellent long-term inflation hedge.”
He believes that yellow metal retains its value due to its invariability, and therefore considers gold to be absolutely essential. Increases in inflation and gold prices are both considered strong economic indicators, such as the period 1976-1980 when people saw an increase in inflation while also seeing a 700 percent increase in gold prices. An increase in taxation is not an option because it simply means higher prices for goods and higher living costs, but we are left with no choice but to fight and combat.