Democrats look to hike taxes on the rich and corporations to pay for $3.5 trillion budget bill

The draft proposal, which could still change before it is expected to be officially released on Monday, calls for increasing the top marginal rate on individuals to 39.6%, up from the 37% rate set by the Republicans’ 2017 tax cut law, according to a plan circulating Sunday and obtained by CNN.

The rate would apply to individuals with taxable income over $400,000 a year and married couples filing jointly earning over $450,000 annually.

The top capital gains rate would increase to 25%, from 20%.

In addition, lawmakers would slap a 3% surtax on individuals with adjusted gross incomes in excess of $5 million.

The proposal also calls for increasing the top corporate tax rate to 26.5%, up from the current 21% set by the Republicans’ 2017 tax cut law. It would only apply to businesses with income in excess of $5 million.

President Joe Biden had called for hiking the corporate rate to 28% to pay for his economic recovery agenda. Prior to the 2017 law, the top rate was 35%.

The plan would also increase a variety of other taxes on the wealthy and businesses, among other measures, raising an estimated total of $2.9 trillion.

This is a breaking story and will be updated.

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