U.S. President Joe Biden claimed on Sunday that the “Inflation Reduction Act of 2022” will not raise taxes on anyone earning less than $400,000 a year, but reports show that claim to be false.
“The Inflation Reduction Act of 2022 will lower health care costs for millions of Americans,” wrote Biden on Twitter. “And, for the first time in a long time, make the largest corporations pay their fair share without any new taxes on people making under $400,000 a year.”
That claim is false, as exposed by the non-partisan Joint Committee on Taxation (JCT), which showed that under the plan, taxes will increase in 2023 for everyone except those earning between $10,000 and $30,000 per year.
The Daily Wire reports:
Those making under $10,000 will see a .3% increase in their federal taxes; those making between $30,000 and $75,000 will see a .1% increase; those making between $75,000 and $100,000 a .2% increase; those making between $100,000 and $500,000 a .3% increase; those making between $500,000 and $1,000,000 a .5% increase; and those making over $1,000,000 a year will see a .6% increase, according to the JCT.
Sen. John Cornyn (R-TX) responded to Biden’s claim on social media, writing that the plan would penalize the poor to subsidize the rich.
“It will subsidize the wealthy at the expense of working families, raise taxes on workers making as little as $10K a year, and unleash an army of IRS agents on taxpayers,” Cornyn wrote. “Oh, and it won’t reduce inflation anytime soon.”
A study from the University of Pennsylvania's Wharton business school found that the Inflation Reduction Act of 2022 would actually “very slightly increase inflation until 2024 and decrease inflation thereafter.”
“These point estimates are statistically indistinguishable from zero, thereby indicating low confidence that the legislation will have any impact on inflation,” the study concluded. “We project no impact on GDP by 2031 and an increase in GDP of 0.2 percent by 2050. These estimates include the impact of debt and carbon reduction as well as capital and labor supply distortions from rising tax rates.”