Fact check: Biden claims wealthiest Americans pay tax rate of 8%.
In a recent speech touting his economic policies, President Joe Biden took aim at the tax rates of the wealthiest Americans, saying: There are a thousand billionaires now and you know what their average tax rate is? 8%."
Posted — UpdatedIn a recent speech touting his economic policies, President Joe Biden took aim at the tax rates of the wealthiest Americans.
Biden has used this figure before, including during his recent trip to Raleigh, but it’s inaccurate because it uses a hypothetical calculation and doesn’t refer to the current tax code.
What is the average federal income tax for the richest Americans?
Currently, if people see their stock shares rise in value over time, those gains are not taxed unless and until the shares are sold. If the shares are never sold, then they are never taxed, and under current law, they may be passed on to the next generation with little or no taxation.
The White House report found that if you include unrealized gains in the income calculations of the 400 richest U.S. families, then their taxes paid would account for just 8.2% of their income.
Economists and policymakers have long debated whether the government should tax unrealized gains. But Biden made it sound as if 8% was the standard rate today, not what would happen under a potential future proposal.
PolitiFact ruling
Biden said "There are a thousand billionaires now and you know what their average tax rate is? 8%."
The wealthiest Americans currently pay an effective tax rate of more than 20% of their income, not 8%.
Again, we rate Biden’s statement False.
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