In a controversial move to try to bolster the nation’s coffers, President Biden is set to reveal an ambitious plan which includes doubling capital gains and crack down on cryptocurrency laundering.
According to internal White House sources, the Administration is willing to apply the wash sales rule to cryptocurrenciesthus closing a loophole that operators have exploited for tax purposes.
THE REGULATION WAR CONTINUES
But that is not all. The president’s budget plan is packed with other measures to save hundreds of billions of dollars, including cutting drug prices, raising some corporate taxes, cutting spending on wasteful programs and cracking down on fraud.
The plan, unveiled Thursday, calls for cutting the federal budget deficit by nearly USD 3 trillion over the next decade.
Of course, such a radical plan is unlikely to pass Congress without opposition from Republicans, who are expected to reject many of the president’s proposals. However, the presentation of the budget will kick off negotiations with legislators that could last for several months.
One of the most controversial measures in the plan is a proposal to change the tax treatment of cryptocurrency transactions, which the Administration says could raise $24 billion.
Cryptocurrency sales are not subject to the same “money laundering” rules that apply to stocks and bonds, which means that Investors can sell their submerged cryptocurrency investments, take a tax-deductible loss, and buy back the same investment immediately. Lawmakers considered this change in the last Congress, but did not sign it into law.
The budget also includes proposals to raise taxes on oil and gas companies by $31 billion, end in-kind real estate transactions that allow homeowners to defer capital gains, and crack down on fraud in pandemic relief programs. .
On the plus side, the budget includes measures to expand daycare centers and finance a universal preschool program. The plan proposes more than $22 billion for early care and education programs and $13.1 billion for Head Startboth increases from last year’s budget levels.
In addition, the president intends to limit the price of insulin to $35 a month for all Americans, a move that will expand a bill last year that imposed the same limit on Medicare beneficiaries.
Taken together, this is an ambitious plan that aims to tackle many of the country’s most pressing problems while generating much-needed revenue. Whether it will pass Congress remains to be seen, but one thing is clear: President Biden is not afraid to go all-out.