Proposals to tax unrealized capital gains would ‘kill the stock market,’ says billionaire investor Mark Cuban

• Mark Cuban said taxing unrealized capital gains would “kill the stock market.”

• President Joe Biden has proposed taxing unrealized gains for individuals worth more than $100 million.

• Kamala Harris is unlikely to endorse Biden’s plan, Cuban said.

Any proposal to tax unrealized capital gains “would kill the stock market,” billionaire investor Mark Cuban said in a statement. a CNBC interview on Thursday.

As part of its far-reaching tax proposals, President Joe Biden has suggested taxing unrealized capital gains for people with a net worth of more than $100 million.

While Vice President Kamala Harris has not endorsed or rejected Biden’s proposal on unrealized capital gains, Cuban said it is doomed to fail.

“If you tax unrealized gains, you’re going to kill the stock market, and that’s going to be the ultimate job plan for private equity, because companies aren’t going to go public because you can get screwed,” Cuban said.

Cuban’s “jigsaw” comment alluded to the main question investors have about the proposed taxes on unrealized capital gains: What happens if those unrealized capital gains ultimately turn into unrealized capital losses in a volatile stock market?

But according to Cuban, who said he has spoken frequently with Harris’ campaign team in recent weeks, it is highly unlikely that Harris would endorse such a plan.

“They realize that’s the problem,” he said, adding of Harris: “Even though she’s not directly in conflict with the Biden tax plan, for her, her value proposition is that we need to tax everybody fairly, starting with the Biden plan. But that’s not necessarily her end point.”

Harris has already rejected some aspects of Biden’s tax proposals, offering her own vision of what she would propose as president.

While Biden has proposed raising the long-term capital gains tax rate to 39.6% for households with taxable income above $1 million, Harris believes that rate is too high and has proposed raising it to 28% instead.

“What I really mean is she’s open-minded. She’s not an ideologue. She wants to do what’s best for business,” Cuban said.

Cuban defended the Democratic presidential nominee despite criticism that Harris has yet to unveil a comprehensive set of economic policy proposals ahead of the November election.

“Like any good CEO trying to right a warship, there are limits to what he can do on any given day,” Cuban said. “Like any good CEO, you have to do it when you have to.”

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