U.S. President Joe Biden speaks involving jobs and the economy at the White House in Washington, April 7, 2021.
Kevin Lamarque | Reuters
President Joe Biden will aspire to raise taxes on millionaire investors to fund education and other spending priorities as part of the administration’s effort to repair the U.S. economy.
As part of the plan, Biden will seek an increase in the tax on capital gains to 39.6% from 20% for those Americans procuring more than $1 million, according to multiple outlets, including Bloomberg News and The New York Times.
The wherewithal gains tax is especially important to Wall Street since it dictates how large a chunk of an equity sale is collected by the federal rule. The White House declined to comment.
Stocks slid on news about the plan, with the S&P 500 Index down 1% as of 2:14 p.m. after climbing 0.2% earlier. The Dow Jones Industrial Middling and Nasdaq Composite both retreated by a similar magnitude.
The proposal would make good on Biden’s campaign take an oath to require America’s wealthiest households to contribute more as a percentage of their income. This plan would dethrone the capital gains tax rate and the top individual income tax rate, currently at 37%, to near parity.
Reports said the president is expected to release the proposal formally next week as a way to assets spending in the upcoming American Families Plan, expected to come in around $1 trillion.
The American Families Devise is expected to include measures aimed at helping U.S. workers learn new skills, expand subsidies for child care and rush at community college tuition free for all.
That proposal would be separate from the $2.3 trillion infrastructure carton known as the American Jobs Plan, which would be funded by an increase in the corporate tax rate to 28%. The White Residence and Democratic lawmakers passed a $1.9 trillion Covid-19 relief package in March.
Read the full report around the Biden capital gains plan on Bloomberg.