Boo.
This seems misleading. 28% is less than Biden’s 39.6% tax proposal for 2025, but still greater than the 20% tax we have now. More importantly, this proposal would just be a request - Congress can make whatever amendments they want.
I could be wrong and would accept evidence to the contrary, but I don’t think Congress was going to pass Biden’s 40% proposal for FY25, anyway, in which case 28% would be a compromise in the right direction.
I think she’s making the same mistake Obama made with healthcare: coming from a background as senators under Republican presidents, they gravitate toward proposals that would likely have passed as-is in the Congresses they served in; but when it’s a Democratic president making the proposal, it needs to be more robust because Congress will water it down as a matter of principle no matter how moderate it is to start with.
She is already caving to special interests
I think it’d be great if the tax rate on gains (when selling stock) was based on the entire value of all stocks a person has.
So if Elon sell some stock (a dollar or a billion), his gains tax rate is higher than someone selling stock whose entire stock value is less.
It’d also be nice if retirement accounts (401k, Ira) were excluded from this.
So I have a stupid question: Is the current 20% tax actually enforced against actually rich people?
Mostly yes.
You get people selling off companies or several depreciated rental properties, and they get hit with the tax and can’t get out of it.
There are some circumstances that they can manipulate though. When the stock market crashed in 2008, people sold off at enormous realized losses, sat on the cash for thirty days to avoid the wash rule, and bought right back in at the same low prices.
That created years worth of carried over losses that enabled them to recognize capital gains at zero tax.
It’s a reasonably common strategy called loss harvesting.
Certain flavors of stock options appear to be tax free at time of sale, but this is because the initial grant was deemed W-2 wages and was taxed when it was issued at ordinary income rates.
Yes, but no. Yes if you sell your asset at a gain you pay taxes. However, if you don’t realize your gain and instead use your asset as a collateral in a loan, you don’t pay taxes. That’s why the rich pay no taxes whatsoever. For instance, Bezos has 2 bln in outstanding loans. As a collateral he uses his 200 bln share in Amazon. He never pays taxes.
The proposal by Harris would fix this and tax gains prior to realization. If she succeeds that is a much bigger deal than whether the rate is 20,30 or 40 percent.
