The majority of all taxpayers will pay no federal income tax on the first $75,000 of their earnings

The centerpiece of Booker’s plan is a straightforward idea: the first $75,000 of income would be tax-free for households filing jointly, with proportional tax relief for single filers and heads of households. The plan would more than double the standard deduction for all taxpayers. This means the majority of all taxpayers will pay no federal income tax on the first $75,000 of their earnings.

Booker’s plan also includes an expansion of tax credits that put more money in the pockets of working families, like the Child Tax Credit, and would be fully paid for by closing unfair tax loopholes used by the ultra-wealthy and big corporations and requiring them to pay their fair share.

“New Jerseyans are working harder than ever, but they’re struggling to get by because they’re facing out of control costs and an economy that is stacked against them—so we need big ideas to start making the American Dream possible for everyone again,” said Senator Cory Booker. "No income tax on the first $75,000 families  earn would be a game changer for working people. This tax cut would immediately put more money in your pocket every month to deal with the high price of everyday expenses, an unexpected emergency, or to plan for the future. This plan can be fully paid for by unrigging our tax system –  so that the wealthiest few and the biggest corporations that are getting rich by keeping prices high  finally start paying their fair share. This idea will ensure Americans who work for a living keep more of their paychecks, help restore tax fairness, and start making America a country where working people can get ahead again.”

Under Booker’s proposal, the median American family would see their taxes cut by roughly 85 percent.

Today, Senator Booker is also unveiling a new tax calculator on his website, available here, allowing individuals to calculate how much taxes they would save under Booker’s proposed legislation.

For years, Booker has championed the expansion of tax benefits for working and middle class American families. In 2019, he introduced the American Families Act and the Working Families Tax Relief Act that would permanently expand the Child Tax Credit and the Earned Income Tax Credit for children and low-income families. In 2021, Booker joined a bicameral coalition that succeeded in including a historic expansion of the Child Tax Credit in the American Rescue Plan Act. Though the CTC expansion ultimately expired, multiple studies found that this expansion of the CTC cut the child poverty rate in the United States in half when in effect.

Additional Details about Booker’s Keep Your Pay Act:

The Keep Your Pay Act would:

• Increase the standard deduction to $75,000. The plan makes the first $75,000 of income tax free for those who are married filing jointly, and includes proportional tax relief for heads-of-households and single-filers, more than double the standard deduction for every American.
• Expand the Child Tax Credit under the American Family Act. The credit would increase to $3,600 per child aged 6 to 17 and $4,320 for children under six, with an additional $2,400 “baby bonus” in the year a child is born to help families meet the high upfront costs of welcoming a new child. The credit would be made refundable, ensuring that no families are left behind for having too little income.
• Expand the Earned Income Tax Credit through the Tax Cut for Workers Act, delivering tax relief to workers without children in the home by expanding eligibility to younger workers aged 19 to 24 and older workers aged 65 and above, groups that are currently excluded from the full benefit, while also tripling the value of the credit.
• Booker's proposal would be fully paid for by closing unfair tax loopholes used by the ultra-wealthy and big corporations and requiring them to pay their fair share. This will include —raising the corporate tax rate, strengthening the corporate tax rules, increasing taxes on stock buybacks, tightening limits on executive compensation deductions, and other measures to return fairness to our tax system.

###