President Biden has put forth an ambitious tax plan, in order to fund $1 trillion in childcare, paid leave for workers and universal pre-kindergarten education.
Sources report that the proposal calls for increasing the top marginal income tax rate to 39.6% from 37%.
America’s wealthiest is likely to be targeted with some proposals set to nearly double taxes on capital gains to 39.6%, particularly for people earning more than $1 million.
Thus far the rate in the US has not exceeded 33.8% in the post-WWII era.
Citizens are likely to be hit by the federal capital gains tax rate of 43.4% : including the 3.8% net investment tax on individuals with income of $200,000 or more, with the latter helping fund the Affordable Care Act.
For the year 2021, the top marginal tax rate remains 37% for individual single taxpayers with incomes greater than $523,600 and $628,300 for married couples filing jointly.
The proposals are likely to put capital gains taxes at the forefront, globally; with Europe charging 19.3%, France and Finland 34% and Denmark a whopping 42%.
With these new proposals, in some states it is likely that the “total capital gains” rate will move above the 50% mark:
rates are likely to rise as follows:
California : 56.7%
New York: 68.2%
Many investment management experts are on the opinion that these tax increases would result in more investments moving outside the Unites States and would slow down the economic drive created by President Trump’s tax cuts that made the United States more competitive globally.