US president Joe Biden has scrapped plans to impose a wealth tax to fund his administration's Build Back Better Initiative valued up to $3tn, Politico reported on Wednesday, citing people familiar with the matter.
The wealth tax was led by numerous Democrats led by Sen Elizabeth Warren [D-Mass] and aimed to raise funds for US programmes and narrow rising income inequality, the report said.
The plans would seek a 2 percent annual tax for earners over $50m and 3 percent for people worth more than $1bn.
— Daniel Dubrovsky (@ddubrovskyFX) March 31, 2021
According to the report, US treasury secretary Janet Yellen said the Biden administration remained undecided on the tax increase.
The wealth tax could potentially raise $3tn over 10 years, Politico reported, adding polls revealed nearly seven in ten voters strongly backed the proposal.
But Biden's team has decided to hike corporation taxes, end federal fossil fuel subsidies and tackle offshore tax havens.
Biden and Warren agreed on several measures, including closing a loophole allowing the wealthy people to inherit fortunes tax-free, and would also continue to call on the White House and Treasury Department to adopt her wealth tax plans, a spokesperson for Elizabeth Warren said told Politico.
“The bottom line is Democrats seem to no longer be afraid of taxing the rich in a major way, and to be very blatant about the fact that we’re raising taxes on the rich. That’s a sea change from where we were just a few years ago,” Adam Green, co-founder of the Progressive Change Campaign Committee, said in a statement.
President Biden's initial $2tn Green New Deal aimed to rebuild infrastructure in the US as well as fund the development of numerous key emerging technologies, including information and communications technology (ICT), green energy, artificial intelligence (AI), semiconductors and many others.
"The richest people in the United States - the top couple hundred - have had billions of dollars in new wealth in the past year during COVID. The world's 500 richest people now have a combined net worth of about $7.7 trillion, and the markets have gone haywire. Well, those people are gonna have to contribute to supporting the common good", he said at the time.
Behaviour and risk scientist Sweta Chakraborty told Sputnik in November last year that Biden's plans to rejoin the Paris Agreement would facilitate reaching global carbon emissions targets, adding failure to do so would weaken efforts to tackle climate change "all around" as the US and China were the world's top carbon emitters.