President Biden released his $6 trillion budget proposal for fiscal year (FY) 2022, which provides $932 billion in non-defense discretionary spending and $756 billion in defense spending. The budget reflects plans already released by the administration, including the $2.3 trillion American Jobs Plan, the $1.8 trillion American Families Plan, and $1.5 trillion in proposed discretionary spending. It projects budget deficits above $1 trillion for the rest of the decade. The budget proposal includes tax changes including those proposed in the American Families Plan and the Made in American Tax Plan that was proposed alongside the American Jobs Plan. The White House budget projects the U.S. economy will grow by about 5 percent in 2021.
Key Themes
The budget is built on the administration’s previously proposed investments in infrastructure, education, research, and public health. It proposes changes to the tax code to ensure that corporations and high-income Americans pay for these investments.
American Jobs Plan – $2.3 trillion
- Fix Highways, Rebuild Bridges, Upgrade Ports, Airports, and Transit Systems
- Deliver Clean Drinking Water, A Renewed Electric Grid, and High-Speed Broadband to All Americans
- Build, Preserve, and Retrofit More Than Two Million Homes and Commercial Buildings, Modernize Our Nation’s Schools and Child Care Facilities, and Upgrade Veterans’ Hospitals and Federal Buildings
- Solidify the Infrastructure of Our Care Economy by Creating Jobs and Raising Wages and Benefits for Essential Home Care Workers
- Revitalize Manufacturing, Secure U.S. Supply Chains, Invest in R&D, and Train Americans for the Jobs of the Future
American Families Plan – $1.8 trillion
- Add at Least Four Years of Free Education (pre-K, community college)
- Provide Direct Support to Children and Families
- Extend Tax Cuts for Families with Children and American Workers
- Strengthen Health Care
Reinvesting Our Foundations
- Makes Historic Investments in High-Poverty Schools ($36.5 billion)
- Launches Advanced Research Projects Agency for Health (ARPA-H) ($6.5 billion)
- Improves Readiness for Future Public Health Crises ($8.7 billion)
- Makes a Major Investment to Help End the Opioid Epidemic ($10.7 billion)
- Invests in Tackling the Climate Crisis ($36 billion)
- Combats the Gun Violence Public Health Epidemic ($2.1 billion)
- Extends Housing Vouchers and Helps End Homelessness ($30.4 billion)
- Invests in Civil Rights Offices Across Government
- Invests in Efforts to End Gender-Based Violence ($1 billion)
- Advances Efforts to Build a Fair, Orderly, and Humane Immigration System
- Upholds Our Trust Responsibility to Tribal Nations
Tax Changes*
- Made in America Tax Plan
- Raising the corporate income tax rate to 28 percent (raises $857.82 billion)
- Revise the Global Minimum Tax regime, disallow deductions attributable to exempt income, and limit inversions (raises $533.5 billion)
- Reform taxation of foreign fossil fuel income: Modify foreign oil and gas extraction income (FOGEI) and foreign oil related income (FORI) rules (raises $84.78 billion)
- Modify tax rule for dual capacity taxpayers (raises $1.43 billion)
- Remove tax deductions for shipping jobs overseas (raises $112 million)
- Repeal deduction for Foreign Derived Intangible Income (FDII) and provide additional support for research and experimentation expenditures
- Replace the Base Erosion Anti-Abuse Tax (BEAT) with the Stopping Harmful Inversions and Ending Low-Tax Developments (SHIELD) Rule (raises $390.05 billion)
- Limit foreign tax credits for sales of hybrid entities (raises $436 million)
- Restrict deductions of excessive interest of members of financial reporting groups for disproportionate borrowing in the United States (raises $18.59 billion)
- Impose 15 percent minimum tax on book earnings of large corporations (raises $148.34 billion)
- Replacing fossil fuel subsidies with incentives for clean energy production (raises $35.04 billion)
- Extend and enhance renewable and alternative energy incentives (costs $256.31 billion)
- American Families Plan
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- Increase top marginal tax rate for high earners (raises $131.92 billion)
- Reform taxation of capital income (raises $322.48 billion)
- Rationalize Net Investment Income and Self-Employment Contributions Act (SECA) taxes (raises $236.5 billion)
- Tax carried (profits) interest as ordinary income (raises $1.47 billion)
- Repeal deferral of gain from like-kind exchanges (raises $19.55 billion)
- Make permanent excess business loss limitation of noncorporate taxpayers (raises $42.86 billion)
- Increase revenues through program integrity allocation adjustment for tax administration (raises $50.28 billion)
- Increase revenues by providing mandatory Internal Revenue Service (IRS) funding for compliance (raises $265.9 billion)
Department Specific Details
HHS: The Department of Health and Human Services released its FY 2022 Budget in Brief which is available here.
Treasury: The Department of Treasury Budget in Brief will be published soon and available here.
Agriculture: The Department of Agriculture Budget in Brief is available here.
Commerce: The Department of Commerce Budget in Brief will be published soon and available here.
Defense: The Department of Defense Budget in Brief is available here.
Education: The Department of Education Budget in Brief is available here.
Energy: The Department of Commerce Budget in Brief will be published soon and available here.
Homeland Security: The Department of Homeland Security Budget in Brief is available here.
HUD: The Department of Housing and Urban Development Budget in Brief is available here.
Interior: The Department of Interior Budget and Brief is available here.
Justice: The Department of Justice Budget in Brief is available here.
Labor: The Department of Labor Budget in Brief will be published soon and available here.
State: The Department of State Budget in Brief is available here.
DOT: The Department of Transportation Budget in Brief is available here.
VA: The Department of Veterans Affairs Budget in Brief is available here.
Corps of Engineers: The US Army Corps of Engineers Budget in Brief is available here.
EPA: The Environmental Protection Agency Budget in Brief is available here.
GSA: The General Services Administration Budget in Brief is available here.
NASA: The National Aeronautics & Space Administration Budget in Brief will be published soon and available here.
NSF: The National Science Foundation Budget in Brief is available here.
SBA: The Small Business Administration Budget in Brief is available here.
SSA: The Social Security Administration Budget in Brief is available here.
Discretionary Spending Requests by Department
- Department of Agriculture
- FY 2022 Budget Request: $27.9 billion
- FY 2021 Enacted: $23.9 billion
- Department of Commerce
- FY 2022 Budget Request: $11.5 billion
- FY 2021 Enacted: $8.9 billion
- Department of Defense
- FY 2022 Budget Request: $715 billion
- FY 2021 Enacted: $703.7 billion
- Department of Education
- FY 2022 Budget Request: $102.8 billion
- FY 2021 Enacted: $73 billion
- Department of Energy
- FY 2022 Budget Request: $46.2 billion
- FY 2021 Enacted: $41.8 billion
- Department of Health and Human Services
- FY 2022 Budget Request: $133.7 billion
- FY 2021 Enacted: $108.4 billion
- Department of Homeland Security
- DHS Program Level
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- FY 2022 Budget Request: $54.9 billion
- FY 2021 Enacted: $54.9 billion
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- Transportation Security Administration Fees
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- FY 2022 Budget Request: -$2.7 billion
- FY 2021 Enacted: -$500 million
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- DHS Program Level
- Department of Housing and Urban Development
- HUD Program Level
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- FY 2022 Budget Request: $68.7 billion
- FY 2021 Enacted: $59.6 billion
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- HUD Receipts
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- FY 2022 Budget Request: -$10.5 billion
- FY 2021 Enacted: -$15.1 billion
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- HUD Program Level
- Department of Interior
- FY 2022 Budget Request: $17.4 billion
- FY 2021 Enacted: $15.0 billion
- Department of Justice
- FY 2022 Budget Request: $35.3 billion
- FY 2021 Enacted: $33.5 billion
- Department of Labor
- FY 2022 Budget Request: $14.2 billion
- FY 2021 Enacted: $12.5 billion
- Department of State and International Programs
- FY 2022 Budget Request: $14.2 billion
- FY 2021 Enacted: $12.5 billion
- Department of Transportation
- DOT Discretionary Programs
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- FY 2022 Budget Request: $25.7 billion
- FY 2021 Enacted: $22.4 billion
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- DOT General Fund Transfer to Mandatory Programs
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- FY 2022 Budget Request: —
- FY 2021 Enacted: $2.9 billion
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- DOT Discretionary Programs
- Department of Treasury
- FY 2022 Budget Request: $15.0 billion
- FY 2021 Enacted: $13.5 billion
- Department of Veterans Affairs
- FY 2022 Budget Request: $113.1 billion
- FY 2021 Enacted: $104.6 billion
- Corps of Engineers
- FY 2022 Budget Request: $6.8 billion
- FY 2021 Enacted: $7.8 billion
- Environmental Protection Agency
- FY 2022 Budget Request: $11.2 billion
- FY 2021 Enacted: $9.2 billion
- General Services Administration
- FY 2022 Budget Request: $1.5 billion
- FY 2021 Enacted: -$1 billion
- National Aeronautics & Space Administration
- FY 2022 Budget Request: $24.8 billion
- FY 2021 Enacted: $23.3 billion
- National Science Foundation
- FY 2022 Budget Request: $10.2 billion
- FY 2021 Enacted: $8.5 billion
- Small Business Administration
- FY 2022 Budget Request: $900 million
- FY 2021 Enacted: $800 million
- Social Security Administration
- FY 2022 Budget Request: $9.8 billion
- FY 2021 Enacted: $9 billion
- Other Agencies
- FY 2022 Budget Request: $25.5 billion
- FY 2021 Enacted: $23.4 billion
Resources