. And the Democratic nominee’s proposal is a bit of a departure from a capital gains proposal by her boss, President
The next step up is those with taxable income up to $518,900. Those individuals are taxed at a 15% rate. “Harris is carrying forward a lot of the ideas that were put forward by the Biden administration on capital gains,” Will McBride, vice president of federal tax policy at the Tax Foundation, told theBiden has had several plans to soak the rich that never came to fruition, even when Democrats controlled both chambers of Congress for the first two years of his administration.
Biden’s plan, if enacted, would have made the capital gains rate about the same as what ordinary income would be taxed at. One reason to have capital gains be taxed at a lower rate than ordinary income is to spur investment and encourage entrepreneurship. While that 33% level for millionaires is more than 11 percentage points below Biden’s proposed top rate of 44.6%, it would still represent the highest all-in top capital gains rate since 1978, something her critics fear would be harmful to business in the U.S. and to the country’s economic growth.
Harris’s proposed change, like any of her tax ideas, is designed to bring in revenue. Still, some of Harris’s other tax changes would raise more.