On Friday (9) President Joe Biden is planning to raise his FY2022 budget by 8.4 percent to $1.52 trillion, including increased spending on education, health care, research and renewable energy to increase the share of non-defense spending.
The Biden budget proposes to restore non-defense discretionary funding to 3.3 percent of GDP, up from 3 percent in FY 2021. Biden’s initial budget proposal does not include a $2 trillion infrastructure package or tax reform, U.S. government officials said.
The White House is expected to submit a full budget to Congress later in the spring.
Biden expects Congress to pass a budget that allocates $753 billion (1.7 percent annual increase) to the defense category and $769 billion (16 percent annual increase) to the non-defense category for fiscal year 2022, for a total of $1.52 trillion.
He proposes significant increases in financial assistance for inequality, disease and climate change, and wants to provide grants for electric vehicles and charging stations.
Details of the budget proposal are as follows.
Proposes more than $14 billion in investments targeting climate change issues to reach net zero emissions by 2050.
Allocates $600 million in grants for electric vehicles and charging stations.
Stops funding for construction of the U.S.-Mexico border wall and eliminates established funding arrangements associated with it.
Provides financial assistance to the CDC and cash-strapped schools.
Allocate $2.1 billion to address gun violence.
In addition, U.S. Treasury Secretary Yellen said IRS enforcement funding would increase by $900 million in fiscal year 2022 under President Biden’s budget. The budget request also includes $13.2 billion for the IRS, an increase of $1.2 billion, or 10.4 percent annually, from FY 2021.
On the other hand, according to the latest data released by the Congressional Budget Office, the U.S. federal deficit has reached $1.7 trillion for the first six months of FY 2021 (October 2020 to March 2021). The Congressional Budget Office said the fiscal deficit for the first six months increased 45% annually compared to 2020, but revenues increased only 6%.
The U.S. fiscal deficit in fiscal year 2020 is already at a record high. Data show that the U.S. fiscal deficit reached $3.1 trillion in fiscal year 2020. According to the development of fiscal year 2021, the fiscal deficit has been unavoidable to a new record high.
Oxford Economics said that additional economic stimulus will continue to push up the fiscal deficit, leading to soaring national debt, which fears that the U.S. economy is further exposed to risk.
However, the U.S. government in order to alleviate the debt problem and increase federal revenues, has recently planned to implement a new plan, intends to start from the personal, household and corporate aspects, including raising the corporate tax rate from the existing 21% to 28%.
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