WASHINGTON, Jan. 18 (UPI) — President Barack Obama will propose new tax increases on the wealthy aimed at assisting middle-class families.
In a statement released by The White House, the proposals will seek to tax “hundreds of billions of dollars” by closing inheritance tax loopholes for the wealthiest Americans.
The capital gains tax on the richest earners will be raised from 23.8 percent to 28 percent, the same tax rate as under President Ronald Reagan.
Financial firms with more than $50 billion in assets will face new fees to limit heavy borrowing by making it more costly for them.
President Obama will promote the proposals during his State of the Union Address on Tuesday.
The new taxes on wealthy families and companies will be spent to “reinvest in the middle class, helping millions of families each year and strengthening their standing in the 21st century economy.”
President Obama’s proposals will aim to create a new $500 credit for 24 million families in which both spouses work and provide up to $3,000 in child care tax benefits for children under the age of 5.
He will also propose reforms to the education tax system by simplifying it and by reducing taxes for 8.5 million people. He also hopes to create incentives to save for retirement making it easier for workers to save through their employer.
Obama will also discuss cyber-security and his plan to make community college free for the first two years.
The proposed plans will likely meet strong opposition from the Republican-controlled Congress.
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