The Day at a Glance | April 26 2021

The Top

*Biden will reveal details about his plans to increase taxes on Wednesday.

*Economists expect the FED to start reducing the asset purchasing program in the 4Q21.

*The Mexican economy shrank (-) 0.3% in February (-4% annual).

Economic environment

President Joe Biden will present a plan to increase the capital gains tax as well as income and property taxes for high-income individuals. Known as the American Family Plan, Biden`s plan seeks to fund a good part of the infrastructure plan and the programs that back the economy through low and middle-income households. The plan will be presented before Congress on Wednesday. A higher income tax is expected to be presented – one that would be applied to individuals with income that exceeds 400 thousand dollars a year, while people that make over one million dollars a year will have to pay a capital gains tax of close to 40%. Additionally, some tax breaks for property owners are expected to be eliminated. Biden`s plan has faced strong opposition from Republicans and some members of the Democratic Party have requested some revisions to be made. Republicans argue that higher tax rates will affect economic activity; while 20 democratic legislators have expressed that they will not vote in favor of the plan if no modifications are made. Long negotiations and discussions are expected to occur in Congress before any measure is approved.