A new survey published by UBS Global Wealth Management found that a significant proportion of U.S. investors with at least $1 million in assets are taking action to get ahead of the tax changes proposed by the Biden administration as “their optimism in the economy wavers due to concerns about politics, potential tax increases, national debt, and inflation.”
“Investors would like to get ahead of potential changes by making adjustments to their portfolios,” UBS said in the survey (pdf), noting that 40 percent said that, due to potential tax changes, they’re thinking about shifting assets that aren’t generating profits.
At the same time, UBS said that 39 percent have sought expert tax advice ahead of the potential changes, 36 percent have shifted some assets into trusts, and 34 percent have increased gifting to family and/or friends.
Concerns about tax increases rose by 9 percentage points to 61 percent in the third quarter compared to the prior quarter, UBS said in the survey, which was based on 900 U.S.-based investors and 500 business owners with at least $1 million in investable assets.
Optimism in the economy, meanwhile, took a dip among those polled, falling 8 percentage points to 61 percent compared to the prior quarter, while pessimism rose 9 percentage points to 26 percent.
The survey comes as President Joe Biden issued a $1.75 trillion social and climate spending framework earlier in the week, which includes plans to raise revenues by imposing a 5 percent tax surcharge on modified adjusted gross income over $10 million a year, strengthening IRS tax enforcement, and a 15 percent minimum tax on reported corporate profits for companies above $1 billion in profits.
In addition to the 5 percent surtax on income over $10 million, the plan proposes an additional 3 percent surtax—for a total of 8 percent—on income above $25 million. It also eliminates opportunities for wealthy taxpayers to avoid paying the 3.8 Medicare tax on their earnings.
The framework also includes a 1 percent surcharge on corporate stock buybacks.
It does not appear to include many of the tax proposals issued last month by the House Ways and Means Committee (pdf)—for instance, it does not propose to raise the top marginal individual income tax rate from the current 37 percent to 39.6 percent.
While Biden’s plan is a scaled-down version of the $3.5 trillion package, it is unclear whether it has full backing from Democrats, some of whom objected to the price tag of the bigger plan. Republicans are opposed.
By Tom Ozimek
Read Original Article on TheEpochTimes.com
