Joe Biden’s tax plan will put middle class in 'peril,' Home Depot’s Langone says

Home Depot co-founder Ken Langone blasted Democratic presidential nominee Joe Biden’s tax plan on Wednesday, saying that “the middle class will be in peril.”

Langone told “Mornings with Maria” on Wednesday that the middle class will feel the effects of Biden’s tax plan even though the former vice president has said the wealthy should pay more in taxes, and that the tax code should be more progressive and equitable. That includes eliminating loopholes that favor the rich and large corporations.

“I don’t know if there’s any of us that have done well that will have a problem with paying more taxes, but it’s a ruse to think that hitting us and us alone is going to get the job done,” Langone said.

“It won’t and the middle class will be in peril and when you take money out of the hands of the middle class, you do a dramatic impact negatively on the economy.”

“The middle class will not be exempt,” he added. “Tragically, it will punish them. It isn’t going to punish us.”

BIDEN'S TAX PLAN COULD CREATE RATES AS HIGH AS 62% FOR NEW YORKERS, CALIFORNIANS

Biden would repeal changes made to individual income tax rates for the wealthy (individuals with incomes over $400,000) under the 2017 Tax Cuts and Jobs Act, which means the top rate would revert back to 39.6 percent, from 37 percent.

Another big change Biden wants to make is to tax capital gains at the same rate as ordinary income for households earning more than $1 million.

Currently, short-term capital gains are taxed at the same rates as income, but long-term gains are taxed at lower rates.

The top long-term rate is 23.8 percent.

“You aren’t going to get the revenue numbers by just taxing the rich,” Langone told host Maria Bartiromo.

“The only way a tax increase will generate revenues is to go after the middle class. That’s where the numbers are,” he continued, adding that “these people are being misled.”

“There is not going to be enough money generated from the so-called rich to take care of all the needs,” Langone went on to say.

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He then stressed that “it is absolutely a fraud to suggest that all the money that’s going to be needed is going to come from the rich and the super-rich.”

“The problem is, when you go after the middle class, you begin to attack the backbone of the economy and we will have a bad recession. We will have a very bad recession,” Langone said.

He pointed out that Biden’s “pitch” is “based politically on the notion” that “we’ll get only the rich people” and the “middle-class people are going to be fine.”

“It won’t work and they know it won’t work,” Langone said, adding that “they’ll find out it won’t work when it’s too late.”

Langone then pointed out that the economic recovery amid the economic fallout from the coronavirus pandemic is going well so far.

“I was very impressed with the unemployment numbers the other day, they’re much better than I thought they would be,” he said.

The U.S. economy added 661,000 jobs in September, according to the Labor Department's payroll report released earlier this month, which was the last report before the Nov. 3 presidential election. It showed the unemployment rate unexpectedly fell to 7.9% from 8.4%.

Langone also said he is optimistic that there will “be more than one” coronavirus vaccine “before Christmas,” while admitting he “can’t prove” it, but that is what he believes.

“These are very precarious times and not the time to be screwing around,” Langone said.

According to the Tax Foundation’s General Equilibrium Model, Biden’s collective policies would reduce GDP by 1.5 percent over the long-run, reduce wages by 0.98 percent and eliminate about 585,000 jobs. But they would increase federal tax revenue by $3.8 trillion between 2021 and 2030 relative to current law.

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The Tax Policy Center estimates Biden’s proposals would increase federal revenues by $4 trillion between 2021 and 2030, relative to current law. It would also disproportionately raise taxes on the top quintile of the income distribution.

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FOX Business’ Brittany De Lea and Megan Henney contributed to this report.