(The Center Square) – Higher taxes, heavier regulations and freer trade will be some of the policy positions taken by presumptive President-elect Joe Biden that will affect Virginians.
According to the Biden tax plan, he intends to raise taxes on individuals who earn more than $400,000 annually, which would include the federal income tax, the capital gains tax and payroll taxes. His plan also would increase the corporate income tax rate from 21% to 28% and establish a corporate minimum tax on book income. Many experts also predict Biden will reverse some of President Donald Trump’s deregulation, particularly environmental deregulation.
Stephen Haner, a senior fellow for state and local tax policy at the free-market Thomas Jefferson Institute for Public Policy told The Center Square that increasing the regulatory burden could have a negative effect on the Virginia economy.
“The regulatory situation is the greatest concern,” Haner said. “A reversal there could impact some of the manufacturing and farming interests. Virginia has already made some very bad decisions on energy that will hit people hard. We are going to join California soon as a poster child of how the Green New Deal promises will skyrocket family costs.”
Scott Lincicome, a senior fellow in economic studies at the libertarian Cato Institute, told The Center Square the higher taxes and the heavier regulations could have a negative impact on the state economy, but he said Biden likely will be better on trade policy.
Biden has signaled he intends to engage more with international organizations, such as the World Trade Organization. Although he has used aggressive rhetoric regarding trade with China, this could mean freer trade with some countries.
Lincicome said freer trade would introduce more competition between American companies and foreign companies, which could hurt some American businesses in the short term but ultimately would provide benefits for everyone through better prices and more options for goods. He said free trade also will provide less expensive products to businesses, which will help some businesses grow.
The president has greater authority to reduce or increase tariffs and direct agencies to impose regulations than he does over tax policy because any tax plan would have to get through Congress. Lincicome said Biden likely will have to work with a Republican-majority Senate, which will try to block potential tax increases proposed by Biden.
Lincicome also said Biden’s plan to scale back immigration and visa restrictions would also improve Virginia's economy by providing more labor options for businesses.
Both U.S. senators from Virginia, who also are Democrats, spoke positively of Biden.
“As governor, I saw firsthand how President-elect Biden led the Obama Administration’s work to help Americans recover from the 2008 recession," Sen. Tim Kaine told The Center Square. "I’m confident a Biden-Harris Administration will build a ladder for American families and businesses to climb out of this economic crisis, too.”
"Getting this health crisis under control is a priority for the Biden Administration," Sen. Mark Warner told The Center Square. "In order to make sure the Biden Administration can get the right footing to begin turning the tide on this health and economic crisis, we’ve got to put politics aside and pass some real relief that meets the urgent need of Virginians. That’s why I’ll continue to push for the inclusion of my Jobs and Neighborhood Investment Act and the Paycheck Security Act, bills I’ve introduced that would help with the economic recovery efforts we desperately need right now.”
The Associated Press and other media outlets have called the election for Biden, but Trump has refused to concede and filed several lawsuits alleging voter fraud and ballot irregularities.