President’s 2016 Budget Proposes Significant Infrastructure Spending
On February 2, President Obama released his proposed budget for 2016 which details a six-year, $478 billion infrastructure plan that would provide a 33 percent increase in funding for public works projects. The plan seeks to upgrade the country’s thousands of crumbling and aging roads, bridges and ports financed in part by a new tax rate on overseas earnings by American companies.
The infrastructure plan proposes efforts to modernize as well as repair existing roads and bridges and modernize our infrastructure with new investments in highways and freight networks as well as bus, subway, rapid transit, light rail, and passenger rail systems in cities, fast-growing metropolitan areas, small towns and rural communities across the country.
Though Democrats and Republicans both appear to be in agreement on the need to improve our country’s infrastructure, the Republican-controlled Congress may object to how President Obama proposes to pay for this effort.
Roughly $240 billion of the funding needed for this plan would supposedly come from current taxes on gasoline and other revenue sources. The additional $238 billion however is expected to come from a transition tax. A transition tax would mean American companies would have to pay a US tax on the $2 trillion they already have overseas.