The United States is in trouble. The country’s enormous debt is almost impossible to pay due to the high interest rates, bringing the US very close to a debt ceiling. That is why the Biden administration wants to raise this ceiling, but it cannot be done just like that. However, Biden refuses to accept the existing proposal and wants major crypto investors to pay more taxes.
Debt ceiling: US government almost bankrupt
Last week it appeared that the US government is on the verge of bankruptcy. After all, in just two months it would run out of money, forcing the huge national debt to be refinanced.
But that is not possible because the US is almost at the debt ceiling. This is an artificial level relative to the Gross Domestic Product (GDP), which should prevent the government from taking on too much debt. After all, it is part of the public sector, which is why it is controversial to raise this level.
The Biden government wants to raise this level, because the alternative is that it will not pay the debt. The US is the largest economy in the world, and many countries and large companies have put a lot of money into US government bonds. Non-payments would therefore have major consequences.
But the Republican party is less happy with the proposal. It would also mean that the government would actually continue to spend too much, and that this would ultimately be passed on to the taxpayer.
Biden wants more crypto tax
Biden is currently in Hiroshima, Japan, for the G7 summit. Here he stated Reuters that the debt ceiling should be raised, but that he does not accept the proposal of the Republicans. It has already been agreed that both parties must reach an agreement because the dilemma has such a major impact.
There is now a fierce battle between the two factions that lead the US. Biden has already announced that he will not accept the current deal. At the G7 summit he said:
“I will not agree to a deal that protects wealthy tax evaders and crypto traders and jeopardizes food aid.”
BREAKING: President Joe Biden speaking on the final day of the G7 summit
“I’m not going to agree to a deal that protects wealthy tax cheats and crypto traders while putting food assistants at risk.”https://t.co/q2ATjj9RFh
📺 Sky 501, Virgin 602, Freeview 233 and YouTube pic.twitter.com/PIf0O5tKXq
— Sky News (@SkyNews) May 21, 2023
Biden has been wanting additional taxes on cryptocurrencies for some time now. To be precise, he would like to apply excise tax to crypto mining. So-called wash sales be made prohibited. This means that traders deliberately sell at a loss so that they can deduct it from their taxes.