Kamala Harris has shifted her tax proposal for capital gains to the centre. The Democratic candidate for the presidency of the United States has decided to distance herself from Joe Biden, who advocated taxing the capital gains and capital gains of the wealthiest at a rate of 39.6%, like other income. The vice president proposes that they be taxed at a rate of 28%, as she announced this Wednesday during a rally in North Hampton (New Hampshire). The proposal somewhat endears her to Wall Street and the big donors to her campaign. In any case, taxes are not approved by presidents, but by Congress, whose composition will also depend on the elections of 5 November.
“If you make a million dollars a year or more, your long-term capital gains tax rate will be 28% under my plan,” Harris said at the outdoor rally, where she was protected by a security screen, an additional measure taken by the Secret Service following the attempted assassination of Donald Trump at a rally in Butler, Pennsylvania, in June.
Harris’ proposal is, in any case, an increase from the current rate of 20%. In addition to that rate, there is a surcharge of 3.8%, which Biden wanted to raise to 5%, for the highest incomes, in order to cover the cost of the Medicare health program. The Democratic candidate has not clarified whether she supports the current president’s idea of increasing the surcharge.
Under his plan, 99% of Americans, including all moderate- and middle-income families, would pay the same long-term capital gains tax rate they pay now. Americans making less than $100,000 would continue to pay no tax, and higher-income families making up to $1 million would continue to pay up to a top rate of 20%, according to his campaign, which says no one making less than $400,000 would pay a penny more in taxes under his measures.
“We will tax capital gains at a rate that rewards investment in America’s innovators, sellers, and small businesses. We know that when government encourages investment, it leads to broad-based economic growth and creates jobs, which strengthens our economy,” he said.
Incentives for new businesses
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Harris also used the outdoor rally in New Hampshire to propose an expansion of tax incentives for small businesses, an entrepreneur-friendly plan that softens her previous calls for wealthy Americans and large corporations to pay higher taxes. Under her proposal, tax deductions for starting a new business would increase from $5,000 to $50,000. Her proposal would allow new businesses to use the deduction immediately or when they start to turn a profit.
“America’s small businesses are an essential foundation of our entire economy,” he said. “One of my top priorities will be to strengthen America’s small businesses. I want to see 25 million new small businesses by the end of my first term,” he added, which would serve to surpass the record of 19 million new small business applications already registered under President Biden. According to the Democratic campaign, small businesses employ half of all private sector workers in the United States, and have created 70% of new jobs since 2019. Supporting them, they say, will be one of the main priorities of his presidency.
Harris promises to launch a small business expansion funding program to help entrepreneurs grow their businesses and create jobs with low- or zero-interest loans. She also pledges to ensure that one-third of federal contracting funds go to small businesses.
Another plank of his proposals is cutting red tape. He aims to make it easier for smaller businesses to file taxes, reduce excessive requirements for obtaining occupational licenses, modernize outdated regulations and cut unnecessary red tape that makes it difficult for small businesses and entrepreneurs to apply for and receive federal funding and other aid, and encourage state and local governments to cut red tape.
Her rival, Donald Trump, has been trying to baselessly paint Harris as a communist and repeatedly calls her “Comrade Kamala,” so her new tax proposals may serve in part to combat that dialectic. Meanwhile, Democrats insist that Trump’s proposals will only serve to cut taxes for billionaires like him at the cost of increasing the deficit and debt in an unsustainable way.
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