Vice President and now-Democrat Presidential Nominee Kamala Harris isn't talking much about her economic plans, except for calling for price controls to fight inflation. And maybe her silence on economics is for good reason, as some of the proposals she supports are starting to leak out. Americans for Tax Reform (ATR) detailed the budget plan Harris has endorsed, and all it entails. One item that grabs particular attention is a proposal for a 25% tax on unrealized capital gains for "high net worth individuals." "High net worth" is defined as those with income and assets totaling more than $100 million, but as ATR writes, "Once in place, it won't be long before the threshold is lowered to hit more and more Americans."
Even if the threshold is not lowered, the plan would be devastating, according to the American Thinker's Monica Showalter. She warns that this plan is akin to Kamala Harris coming for your house. "This is outrageous, nobody in the world does this, everybody who has tried it has completely dropped it," she tells KTRH. "It's an extremely bad idea...you would only want to do this if you wanted to wreck the economy."
Taxing unrealized gains means that people would be taxed on the increase in value of their homes, stocks and other investments regardless of whether they actually sold or cashed out those assets. As Showalter points out, other countries that have tried this, such as Norway, saw disastrous results as billions were taken out of the economy to avoid the taxes. Then there is the question of whether the government can tax money that hasn't been received yet. "In most countries, it's totally illegal and I believe even in the U.S. it is illegal," she says.
If this plan did pass legal muster and take effect in the U.S., Showalter predicts it would lead to disastrous results, with people moving their assets overseas or fraudulently trying to reduce the value of their assets. "It's a total recipe for capital flight, offshore accounts, assets hidden, those black market-type things," she says. "There's no better way to just drive capital out of the country, because nobody is going to want the value of their property or their assets to ever go up."
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