What you're not hearing about the coming tax hikes

The House Ways and Means markup proposes $2 trillion in tax hikes over 10 years. $1 trillion on the corporate side takes 4.6% off S&P 500 earnings, but this is half what we expected in March when the take hikes were first proposed. The top rate is proposed now at 26.5%, with carried interest treatment preserved. For individuals, the top rate of 39.6% kicks in at $400,000 income; the capital gains rate rises to 25%, not the 39.6% expected; basis step-up for estates is preserved. There is no mention of restoring the SALT deduction, which sets up a fight with Democratic representatives from high-tax states. The proposed hikes will shrink further in the Senate, where Manchin, Sinema and Tester have all called for a maximum of $1.5 trillion in spending. The proposals raise taxes on households earning less than $400,000 violating Biden's promise. Heightened political theatrics make it all the more likely that moderate House Democrats facing re-election in swing districts in 2022 won't dare support reconciliation.