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A part of the Washington Policy series
President Elect Biden promises to accelerate legislative and regulatory action on several key initiates during his first 100 days of office. Shortly after the inauguration, the Biden Administration will officially send a sixth stimulus package to Capitol Hill. House and Senate Democrats will coordinate efforts and produce a bill for floor consideration within weeks. The proposal will draw Republican opposition because of its massive cost and scope. Central to the Democrat’s stimulus package will be additional direct cash payments and federal unemployment benefits, small business loans, student loan forgiveness, funds for childcare and medical leave related to COVID-19, vaccine distribution, and state and local government aid.
On the heels of the stimulus legislation, Democrats on the House and Senate tax-writing committees will start drafting the details of President Biden’s tax plan for introduction in early spring and final action by summer. The Administration may carve out a few popular tax provisions from the tax plan for inclusion in the stimulus package mentioned above (as an example, the possible reinstatement of the state and local tax (SALT) deduction) to broaden support for the bill. The Democrat’s broader tax plan will likely call for the repeal of key provisions of the Tax Cuts and Jobs Act of 2017, including (a) the special tax rate for small businesses; (b) an increase in the corporate tax rate; (c) an increase in capital gains tax rates; and (d) a reinstatement of the pre-2018 gift and estate tax exemption.
Other Administration priorities like immigration and infrastructure legislation will take more time to develop and move through the legislative process. Comprehensive legislation in these areas could run into 2022 because of the complexity of these issues. As we noted in a previous article, immigration and infrastructure are policy areas where Democrats and Republicans can find common ground.
And last but not least, President Biden will start the regulatory ball rolling by issuing a slew of executive orders on January 20, 2021. The President will freeze all pending regulations across the government and is expected to reinstate several Obama-era policies addressing methane limits on oil and gas operations, vehicle emission standards, and new restrictions on oil and gas leases on public lands and waters, to name a few.
We will continue to keep you updated on developments from Washington. Please do not hesitate to call your SVB Private representative with any questions.
