Fact Check: Did Biden Raise 'Tax Burden' for Americans Earning $20,000?

Between inflation, government default, a banking collapse and a global cost of living crisis, Americans have had to pull tight on purse strings this year, with little sign of meaningful relief in sight.

The inequality crisis during the COVID-19 pandemic, combined with emerging crises like the war in Ukraine, have led to increased uncertainty across everything from the cost of living essentials to the integrity of global supply chains.

Amid these concerns, claims have appeared online recently that lower-earning families will feel an additional brunt on their tax bills, despite pledges by the Biden administration that it would not cause these pressures.

The Claim

A tweet by RNC Research, posted on April 25, 2023, viewed 197,000 times, said: "Biden starts screaming the lie that "NO ONE" making under $400,000/year will see taxes go up.

"Biden broke that promise long ago — raising the tax burden on families making as little as $20,000/year."

The tweet included a video of Biden in which he said: "Let me be clear, in my administration no one, no one, earning less than $400,000 a year will see their taxes go up a single solitary penny."

The Facts

One of the issues with this claim is that without sufficient context, one could be led to believe it means Biden has increased taxes for people earning $20,000.

Indeed, as there is an accompanying claim that Biden is lying about tax freezes for those under $400,000, it's arguably logical to assume that all the claims here are about direct increases.

There is some giveaway wording here, though. Rather than saying Biden has increased taxes for those on $20,000 per year, the tweet says he raised the "tax burden."

The argument is based on promises made under the Inflation Reduction Act bill to not raise taxes among lower-income and some middle-class families. To be clear, the Inflation Reduction Act did not raise taxes for those earning $20,000 (or anyone under $400,000 a year, as a previous Newsweek investigation found).

However, the bill's introduction was preceded by research that suggested the effect of the bill could lead to trickle-down changes that would, in effect, leave lower-income families with higher costs.

The analysis, by the bipartisan Joint Committee on Taxation (JCT), estimated how a tax increase on some could impact all wage brackets, including those who make less than $400,000 per year.

But, the findings by the JCT did not state there would be a direct increase in taxes. It was an economic analysis of the possible effects of (only some parts) of the Inflation Reduction Act, which suggests that its tax changes are likely to bear costs for everyone.

It argued that other tax changes in the bill (such as an increase in corporation tax) could affect other assets that taxpayers might have, such as pension funds or investment portfolios.

Additionally, if returns on investments are reduced, capital investment could fall, as well (the less money there is to go around, the less money people might be willing to invest). In theory, this could diminish workforce productivity (for example, companies might have to freeze hiring or reduce staff as investment rates drop) and cause a reduction in wages.

The argument is that although your taxes might not increase, your spending power might nonetheless be diminished.

RNC Research confirmed to Newsweek that the JCT analysis was the basis of the tweet, adding, "we correctly call out Biden's false claim that the middle class won't pay a "penny more" in taxes when they are bearing the burden of the tax increase."

Nonetheless, although some might understand that "tax burden" could be referring to indirect taxation or rising costs, that context is not sufficiently explained by RNC Research's tweet.

The analysis also doesn't detail the potential for positive indirect impact of the bill, such as stepped-up benefits for middle-income households.

The Ruling

Needs Context.

Without additional context, one might interpret the tweet to mean that taxes had increased for those earning $20,000 under President Joe Biden's administration.

What RNC Research is, in fact, referring to here is an analysis by the Joint Committee on Taxation that other aspects of the Inflation Reduction Bill could lead to an impact on the spending power of people at those pay levels.

The analysis, however, is speculative and others suggest that there might be other positive indirect impacts of the bill that could benefit families on lower incomes.

FACT CHECK BY Newsweek's Fact Check team