Bidenomics Capital Gains Proposal Will CRUSH Economy, Expert Warns

( US President Joe Biden has frequently lauded his own economic policy, dubbed Bidenomics, although financial experts are speaking out against his proposal to hike the capital gain tax rate for some people. The Treasury Department announced that Biden’s fiscal year 2025 budget proposal would raise the top marginal rate to 44.6% for capital gains and qualified dividends, which could dissuade investors.

Raising the capital gains tax will result in less investment, which is a “real driver” of economic growth, Heritage Foundation research fellow E.J. Antoni said. The economist explained that investment contributes to increases in productivity and business development. Such a tax increase will dramatically hamper improvements in standard of living, Antoni said.

Moreover, increasing the capital gains tax could also incentivize the government to maintain a high inflation rate, because inflation raises the price of stocks and other equities that are subject to taxation, Antoni said. The proposed 44.6% rate is the highest rate since the government started taxing capital gains in the 1920s.

Antoni is not the only financial expert commenting on Biden’s proposal; real estate investor Grant Cardone said that the move could end up costing Biden politically, ahead of the 2024 US presidential election. The last president to raise capital gains taxes to such levels was Democrat Jimmy Carter, who ended up losing the 1980 election to Republican Ronald Reagan with just 49 electoral college votes.

Carter lost the White House due to multiple factors, including high inflation and tensions with Iran—a situation reminiscent of the one Biden finds himself in now. Biden is expected to rematch former US President Donald Trump, who has promoted lower tax rates, in the 2024 race.

The issue of taxation is at the forefront of the 2024 election season. Biden said that he will let a 2017 Trump-backed tax cut expire if he is reelected in November. Although, the presidential race is not the only one that could impact tax policy.

Republicans could extend tax cuts and other policy changes if they retain control of the House of Representatives and retake the Senate and the White House. However, Republicans will have to compromise with Democrats if they hold power in Congress or the executive branch.

Bidenomics may be popular in the current administration, but the Biden regime is not guaranteed continued control, especially if they impose such a tax hike during election season.

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