Households with income of at least $1 million would see their average tax rate increase in 2022 under House Democrats social spending and climate bill, according to a corrected report released by the Joint Committee on Taxation (JCT) on Tuesday.
The average tax rate for those taxpayers would increase from 29.9 percent under current law to 33.1 percent, JCT said.
The corrected report comes after JCT, Congresss nonpartisan tax scorekeeper, originally released a report on Friday that found that the average tax rate in 2022 for taxpayers with income of at least $1 million would decrease slightly, from 29.9 percent to 28.2 percent.
That finding caught the attention of some right-leaning tax experts. However, JCT said Tuesday that it had initially made an error in calculating the average tax rates for 2022.
White House Chief of Staff Ron KlainRon KlainSenate Democrats look to fix ugly polling numbersBiden briefly transfers power to Harris while he gets colonoscopyThe Memo: Democrats may rue pursuit of BannonMORE took note of the correction on Twitter.
Um, yes. https://t.co/xy5s4ivpoG
Ronald Klain (@WHCOS) November 23, 2021
The social spending bill that the House passed on Friday includes several provisions aimed at increasing taxes on high-income households, including a surtax that would apply to households income above $10 million. But it also includes a provision to increase the cap on the state and local tax (SALT) deduction from $10,000 to $80,000, which several think tanks have estimated would largely benefit high-income households.
The Urban-Brookings Tax Policy Center has estimated that about two-thirds of taxpayers in the top 1 percent of income those with income of above $885,000 would get a tax cut in 2022 under the bill. However, households in the top 1 percent would on average see a tax increase.
Republicans have been attacking Democrats over the provision on the SALT deduction, and some Democratic lawmakers have also raised concerns about it. Key Democratic senators are working on an alternative proposal on the SALT deduction that would focus changes to the cap on households with income under a level between $400,000 and $550,000.