As she continues to finalize the details of her economic platform, Vice President Kamala Harris on Wednesday called for raising the capital gains tax to 28% for those making more than $1 million a year, offering a smaller increase than the one proposed by President Joe Biden.
The current capital gains tax rate is 20%, which Biden has proposed raising to 39.6% for top earners. There’s an additional 3.8% tax on investments for high earners, which Biden wants to raise to 5%, which would result in a potential top rate of 44.6%. Harris hasn’t said what she wants to do with the investment tax, but The Wall Street Journal reports that she favors raising it along the lines of what Biden has proposed, which would result in a total top rate of 33% for her proposal — more than 10 points below Biden’s total top rate.
Harris said her proposal strikes a balance between encouraging investment and ensuring wealthy investors pay enough taxes overall. “While making sure the wealthy and large corporations pay their fair share, we will tax capital gains at a rate that rewards investment in America’s innovators, founders, and small businesses,” Harris said at a campaign event in Portsmouth, New Hampshire.
In addition to the capital gains tax proposal, Harris called for more support for small businesses and entrepreneurs. Harris wants to increase the small business tax deduction from $5,000 to $50,000 and create a standard deduction that all small businesses can use.
Harris said she will aim to create 25 million new small businesses in her first term, surpassing the record of 19 million set under Biden. “As president, one of my top priorities will be strengthening America’s small businesses,” she said.
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