“Here’s the $5 trillion list of tax hikes Kamala Harris just endorsed,” says Grover Norquist of Americans for Tax reform. That
Includes:
– Corporate tax rate higher than China
– 39.6% tax rate on small businesses
– 44.6% cap gains tax rate (more than twice China’s rate)
– Unconstitutional wealth tax.”
As Mike Palicz of ATR explains,
Vice President Kamala Harris wants to extract a $5 trillion tax increase from American households and businesses, her campaign confirmed on Monday.
The Harris campaign officially endorsed the laundry list of new and higher taxes included in the Biden-Harris administration’s fiscal year 2025 budget, a plan that would increase taxes by $5 trillion over ten years.
The burden of Harris’s tax increases will hit households in the form of diminished wage growth and higher costs of goods and services. These Harris tax increases will make the U.S. less competitive vs. our adversaries.
Harris also endorsed further increasing the size and power of the already-supersized IRS and erode taxpayer rights by watering down procedures designed to protect taxpayers from abusive and dishonest IRS agents…..
Corporate tax rate higher than the EU and communist China.
Kamala Harris wants to hike the current 21% federal corporate income tax rate to 28%, higher than communist China’s 25% and the EU average of 21%, her campaign said Monday.
The Kamala Harris federal 28% rate is higher than the Asia average corporate tax rate of 19.8%, the EU average of 21%, the world average of 23.5%, and the OECD average of 23.7%….The Harris federal 28% rate is also higher than Canada (26.2%), the UK (25%) Sweden (20.6%), and even Russia (20%), Afghanistan (20%), and Iraq (15%).
After adding state corporate income taxes, the combined federal-state tax burden in most states will easily exceed 30% under the Harris plan.
The Harris rate hurts the USA vs. China with its 25% rate. And note: Industry sectors of strategic use to the Chinese government pay an even lower rate of 15%.
American workers will bear the brunt of Harris’s corporate tax increase.
The non-partisan Joint Committee on Taxation affirmed in congressional testimony that corporate tax rate hikes hit “labor, laborers.” A study compiled by the Tax Foundation found that “labor bears between 50 percent and 100 percent of the burden of the corporate income tax, with 70 percent or higher the most likely outcome.”
Capital gains and dividends tax more than twice as high as communist China
Here is a direct quote from the Biden-Harris budget: “Together, the proposals would increase the top marginal rate on long-term capital gains and qualified dividends to 44.6 percent.“
Yes, you read that correctly: A Kamala Harris capital gains and dividends tax rate of 44.6%
China’s capital gains tax rate is 20%. Is it wise to have higher taxes than China?
Under the Harris plan, the combined federal-state capital gains tax exceeds 50% in many states. California will face a combined federal-state rate of 59%, New Jersey 55.3%, Oregon at 54.5%, Minnesota at 54.4%, and New York state at 53.4%.
[This rate is so excessive that it would actually raise less revenue than a 25% rate, by both reducing investment, and reducing realization of gains. It is a punitive tax rate, rather than a revenue-maximizing rate. As economist Brian Riedl notes, “A 44.6% capital gains rate – up to 58% with state taxes – would likely lose revenue (and this tax is paid on inflationary rises as well as real gains)” — most capital “gains” in periods of inflation are just asset prices rising due to inflation. “Between 1970 and 1980, U.S. stock prices fell by half after being adjusted for inflation. But if you sold stock in 1980, after a decade of getting poorer and poorer you would have had to pay capital gains tax” because of inflation.]
Unconstitutional wealth tax on unrealized gains
The Harris-endorsed budget calls for an annual 25 percent minimum tax on the unrealized gains of individuals with income and assets exceeding $100 million. Once in place, it won’t be long before the threshold is lowered to hit more and more Americans.
Americans overwhelmingly oppose taxes on unrealized gains, by a factor of three to one, including 76% of independents. Americans know that a “gain” isn’t “real” until it is actually realized, in hand.
This Harris tax is similar to the wealth taxes pushed by radical progressives such as Sens. Elizabeth Warren (D-Mass.) and Bernie Sanders (I-Vt.).
Capital gains taxes should only be paid when a gain is realized. Harris’s wealth tax would break with current tax policy and impose tax Americans based on the value of an asset on a particular arbitrary date.
This unprecedented tax would give even more power to the IRS, encourage taxpayers to move assets overseas, and will only expand to hit millions of Americans over time.
[As economist Brian Riedl points out, “A 25% minimum tax hitting theoretical income is so wildly punitive, anti-growth, & unworkable that not even Europe does that.”]
A second Death Tax by taking away stepped-up basis when parents die
Harris wants to impose a second Death Tax by taking away stepped-up basis when parents die. This would result in a mandatory capital gains tax at death — separate from, and in addition to — the current Death Tax.
This will impose a steep tax increase and paperwork nightmare for small businesses, farms, and families….Harris’s proposal to take away stepped-up basis has already been tried, and it failed: In 1976 congress eliminated stepped-up basis but it was so complicated and unworkable it was repealed before it took effect.
As noted in a July 3, 1979 New York Times article, it was “impossibly unworkable.”….. “Not only were there protests from people who expected the tax to fall on them — family businesses and farms, in particular — bankers and estate lawyers also complained that the rule was a nightmare of paperwork.“
Harris’s policies would also make America poorer, requiring increases in tax rates to compensate for the lost tax revenue resulting from her policies impoverishing and shrinking the economy. Harris supports price controls, which would harm the economy, and which more than 95% of economists oppose, viewing them as harmful.
Harris has previously proposed massive spending increases that would require huge tax increases and risk bankrupting the country. As a senator, Harris proposed handing out $21 trillion in welfare payments during the pandemic, as the American Enterprise Institute notes. That would have bankrupted America. That $21 trillion spending increase would have more than doubled the federal budget, and would have given America a national debt far bigger compared to its economy than other countries that borrowed so much they became insolvent.
Harris has a history of left-wing stances, such as supporting the Green New Deal (which could cost $90 trillion), rent control, and racial redistribution of wealth.
