The U.S. Department of the Treasury’s Fiscal Year 2023 revenue proposals, published in what is known as the “Greenbook,” include plans by the Biden administration to raise the corporate income tax rate to 28 percent and to impose a minimum income tax of at least 20 percent for extremely wealthy taxpayers. The administration would also close several loopholes used by high-income taxpayers, such as the carried interest preference and the like- kind exchange real estate preference.

In a summary page, the document states, "Reforms to business and international taxation would collect sufficient revenue, build a fairer tax system, and reduce tax incentives that encourage profit shifting and offshoring." It adds, “For extremely wealthy taxpayers, a minimum income tax would require prepayment of taxes on unrealized capital gains, such that liquid taxpayers are taxed at a rate of at least 20 percent on their income including unrealized capital gains. Similarly, several loopholes used by high-income taxpayers to avoid income, estate, and gift taxation would be closed, including the carried interest preference and the like- kind exchange real estate preference, which would be eliminated for those with the highest incomes.”

According to Accounting Today, the release of the Greenbook comes on the heels of an announcement by President Biden Monday of his administration’s $5.8 trillion budget request for fiscal year 2023. The budget calls for over $2.5 trillion in tax hikes on the wealthy and large corporations over the course of a decade. 

The 120-page document includes several proposals to reform business and international taxation, in addition to raising the corporate rate to 28 percent. These include adopting the undertaxed profits rule  and providing tax incentives for locating jobs and business activity in the United States.  

With regard to high-income taxpayers, the proposals include increasing the top marginal income tax rate for high earners and reforming the taxation of capital income. Among the loophole-closing measures proposed are plans to tax as ordinary income a partner’s share of income on an “investment services partnership interest,” to repeal deferral of gain from like-kind exchanges and to require 100 percent recapture of depreciation deductions as ordinary income for certain depreciable property. 

The Greenbook also includes proposals to support housing and urban development, modify fossil fuel taxation, support families and students and modify estate and gift taxation. The proposals further include measures to improve tax administration and compliance, improve benefits tax administration and modernize rules for digital assets.