Back in 2008 when Obama was debating Hillary Clinton on national TV, Obama discussed with the moderator how raising the capital gains rate would likely reduce federal revenue collections, but he insisted it was good policy anyway — because it was a policy of “fairness”.
Why would raising the capital gains tax be a revenue loss? The effect of higher taxes slows the economy because those paying the higher capital gains have less money to invest. Unfortunately, such a policy was implemented in 2013 when capital gains went from 15-20% and was coupled with the new 3.8% surtax on investment income to pay for Obamacare, making the rate 23.8%.
Now he wants to tax, yet again, the very type of taxpayers who have money to create jobs and/or invest, by raising the capital gains rate up to 28%. This is essentially about an 18% tax hike on high income earners — two years after the last capital gains rate increase. That’s practically doubling the rate in just a few short years. And during this time, the economy has remained sluggish.
It’s a shame that Obama continues to push for policies that would have a negative effect on jobs and the economy in an effort to promote “fairness through taxation” and pay for his pet projects (such as free community college!). The concept of an American President continuing to go after people making a lot of money it is particularly loathsome; it also displays an absolute lack of familiarity with and respect for how people get wealthy — he just wants their hard-earned money.
Back in 2008 during that same debate, Obama claimed, “What I want is not oppressive taxation. I want businesses to thrive, and I want people to be rewarded for their success. But what I also want to make sure is that our tax system is fair and that we are able to finance health care for Americans who currently don’t have it and that we’re able to invest in our infrastructure and invest in our schools. And you can’t do that for free.”
But with Obama, you can do it by wealth transfer.