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America's millionaires are preparing for a tax hike next year, despite predictions of a deadlock in Washington and a Republican-led Senate, according to the CNBC Millionaire Survey.
Almost two-thirds of millionaires say taxes will rise under a Biden government. This was found in a survey that asked 750 people with investable assets greater than $ 1 million. And 43% say they already pay too much tax according to the survey.
"I think the affluent look at spending on incentives and the impact of the virus and they realize that some form of their taxes will rise for many years to come," said George Walper, CEO of Spectrem Group, which conducts the survey at CNBC. "You are realistic."
President-elect Joe Biden campaigned for a promise to increase taxes for those who earn more than $ 400,000 a year. With the Senate likely to be split or remain under Republican control, it seems less likely that a major tax overhaul will be carried out.
With deficits and spending rising, many of the rich expect a tax hike to offset the cost. Walper said even if federal income taxes don't go up, states and municipalities may need to raise taxes to make up for the lack of new federal aid.
"You look at property taxes, they could go up," said Walper.
When it comes to tax justice, American millionaires feel they are paying enough already. While 50% say they think the amount they are paying is fair, 43% say they are paying too much, while 8% say they are paying too little.
At the same time, they think Biden's income threshold of $ 400,000 for tax increases is the right level. More than half said the $ 400,000 cutoff was "about right," while roughly equal numbers (22% and 26%) say it's either too high or too low. The answers, however, varied depending on the political party. Only 11% of Democrats said the $ 400,000 threshold was too low, compared with 38% of Republicans.
Despite predictions that the wealthy would sell stocks or make major changes to their properties due to Biden's tax plan, millionaires plan few changes to their investments or financial planning due to possible tax hikes. Only 17% planned to sell stocks in 2021 due to possible tax changes. With Biden advocating an increase in estate tax, 16% plan to make changes to their donation or estate planning.