An Overview of President Biden’s Budget Proposal

President Joe Biden recently released a $6 trillion budget proposal for fiscal year 2022. The budget proposal would raise total spending to $8.2 trillion by 2031. It includes a call to increase spending on infrastructure through the American Jobs Plan and includes the American Families Plan, which is meant to address child care, universal prekindergarten, and paid family and medical leave.

President Biden’s budget plan proposed $11.2 billion for the Environmental Protection Agency (EPA), a 22 percent increase from the previous year. There is also a major push to support clean energy technology through spending and tax breaks equating to $800 billion over the next decade to incentivize companies to use clean energy.

Several other agencies would also see proposed increases under President Biden’s budget proposal. For example, President Biden is requesting to increase the Department of Energy’s budget by $4.3 billion, or 10 percent. Under the proposal, the Federal Emergency Management Agency (FEMA) would receive a budget increase of 7 percent to $28 billion.

President Biden also included major healthcare reform as a part of his budget summary. These ideas include the creation of a public option health insurance plan, an effort to lower prescription drug costs, a plan to lower the age of eligibility for Medicare, and an expansion of Medicare benefits, to add vision, hearing and dental coverage. However, the budget proposal did not include the estimated costs of these changes.

Additionally, President Biden requested an increase of $6.3 billion for the Department of State and international programs, more than 11 percent above current levels. The proposal also asks for $14.9 billion for the Department of the Treasury, including $13.2 billion for the Internal Revenue Service (IRS), which is a 10.4 percent increase from current funding.

With this increase in IRS funding, President Biden plans for the Service to “increase oversight of high-income and corporate tax returns to ensure compliance; provide new and improved online tools for taxpayers to communicate with the IRS easily and quickly; and improve telephone and in-person taxpayer customer service, including outreach and assistance to underserved communities,” according to the discretionary budget request from April.

Chad Hooper, Executive Director of the Professional Managers Association (PMA), an association representing IRS managers, applauded the funding increase in a statement while calling for longer term increases, stating, “Additional funding is absolutely critical to ensuring the IRS can accomplish its mission as the single largest revenue source for the entire federal government. Put simply, adequate funding for the IRS underpins every other policy object the Biden-Harris Administration has proposed… Unfortunately, even the proposed increase in funding would not return the IRS to the funding levels necessary for the Service to conduct critical modernization initiatives and ensure the equitable delivery of taxpayer services. While short term funding increases are appreciated, PMA has urged Congress to commit to more sustainable, long term funding.”