Republicans Applaud Biden's Plan to Raise Taxes of Billionaires

President Joe Biden's plan to raise taxes on billionaires was applauded by Republican Senators Ted Cruz and Josh Hawley on Thursday night.

Biden vowed to raise taxes on billionaires to a minimum rate of 25 percent during his 2024 State of the Union address, joking about the "great sacrifices" that billionaires are currently making by paying an average of 8.2 percent.

Cruz and Hawley, both ideological opposites of Biden and frequent critics, applauded Biden's remarks on taxes, according to Newsweek congressional correspondent Alex Rouhandeh, who was in the chamber during the State of the Union.

Not all Republicans were pleased, however, with GOP Congressman Matt Gaetz later exclusively telling Newsweek that he thought Biden's plan was "insincere."

The Context

Hawley and Cruz were seated together during Biden's State of the Union speech, which could be the president's last if he fails to defeat former President Donald Trump in a likely November rematch.

Biden last year unveiled his plan to tax the richest 0.01 percent of Americans—who the White House estimates currently pay an average annual tax rate of 8 percent—a minimum rate of 25 percent, arguing that it would raise $440 billion over the next decade.

Former Trump adviser Steve Bannon told Newsweek at the time that he "directionally" supported Biden's billionaire tax plan. Other prominent Republicans, including Cruz and Hawley, did not then publicly back the plan.

What We Know

During what was a fiery and often political State of the Union on Thursday, Biden mentioned that there were "1,000 billionaires in America" before asking if anyone in the crowd knew what "average federal taxes" billionaires paid.

"No," Biden said after someone in the audience shouted a suggestion. "They're making great sacrifices: 8.2 percent. That's far less than the vast majority of Americans pay."

"No billionaire should pay a lower federal tax rate than a teacher, a sanitation worker or a nurse," he continued, drawing loud applause. "I propose a minimum tax on billionaires of 25 percent. Just 25 percent."

Views

Newsweek reached out for comment to the offices of Hawley and Cruz via email on Thursday night.

Just after the State of the Union address, Gaetz told Newsweek that he did not believe Biden's billionaire tax plan was genuine when asked about the applause by Cruz and Hawley.

"I found it insincere," Gaetz said. "I don't think that Joe Biden is really serious about tax equity for anyone. I think that he's more interested in spending more money, and he's embraced a series of inflationary policies tonight."

The Republican congressman then bashed Biden's announcement of a $400 monthly tax credit for homebuyers to help offset the rising cost of mortgages.

"I think it's astonishing to hear the president stand up and say, 'I'm going to tackle inflation, and to tackle inflation, I'm giving a large swath of the American people an additional 400 bucks a month," Gaetz said. "That, by definition, is inflationary."

What's Next?

While Biden will likely continue to push his billionaire tax plan as the 2024 presidential election approaches, the likelihood of the proposal or any similar measure passing prior to the election seems extremely remote.

Biden also indicated on Thursday night that he hopes to extend tax credits for health care and reinstate the pandemic-era child tax credit, while arguing that his tax plan would not raise the burden "one penny" on anyone making $400,000 or less per year.

Tax cuts enacted during the Trump administration, meanwhile, are also on the ballot in November, as they are set to expire at the end of 2025 and will almost certainly not be extended by Biden if he remains in office.