As she continues to flesh out the details of her economic platform, Vice President Kamala Harris on Wednesday called for raising the capital gains tax to 28% for those earning more than $1 million a year, offering a smaller increase than President Joe Biden has proposed.
The current capital gains tax rate is 20%, and Biden has proposed raising it to 39.6% for top earners. There is an additional 3.8% investment tax on high-income earners, which Biden wants to raise to 5%, which would produce a potential top rate of 44.6%. Harris has not said what she wants to do with the investment tax, but the Wall Street Journal reports that she supports raising the tax rate in line with Biden’s proposals, which would produce an overall top rate of 33% for her proposal, more than 10 percentage points lower than Biden’s overall top rate.
Harris said her proposal strikes a balance between encouraging investment and ensuring wealthy investors pay enough taxes. “While ensuring 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 providing more support to 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 can be used by all small businesses.
Harris said she would set a goal of creating 25 million new small businesses in her first term, surpassing Biden’s record of 19 million. “As president, one of my biggest priorities will be strengthening America’s small businesses,” she said.
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