Tipsheet

Experts Warn Kamala Harris' Tax Proposal Would Destroy America

Sarah Arnold
Sarah Arnold  |  August 30, 2024 5:30 PM

Experts are warning against Vice President Kamala Harris’ proposed tax strategy, which they say would threaten the future of the United States economically. 

Recently, Harris’ campaign confirmed that the Democratic presidential nominee supports a $5 trillion tax increase, among a long list of other tax hikes, to the unrealized gains of wealthy Americans. Economic advisors caution that such a move would be a financial calamity, resulting in the most significant tax increase the U.S. has seen in over 40 years. 

Harris’s 28 percent federal corporate tax rate and 44.6 percent top capital gains and dividend tax rate would give the United States the highest total tax rate on corporate income in the developed world when combined with state taxes. As I recently explained, workers ultimately bear most of the cost of the corporate income tax through lower wages and fewer job opportunities. Because the corporate income tax is one of the most economically destructive ways to raise revenue, the total economic cost of Harris’ proposed tax hike will likely be multiple times larger than the tax revenue it raises. The Harris plan would also increase top federal income tax rates so that combined state, local, and federal tax rates would be on the wrong side of the Laffer curve in 36 states and Washington, DC—the point at which higher tax rates create so much economic distortion that they no longer bring in additional tax revenue. Via Cato Institute. 

Republican and Ohio businessman Vivek Ramaswamy also warned about the implications Harris’ tax proposal would have on Americans, suggesting the vice president would destroy the U.S. and drive straight into communism. 

Under the current tax system, Americans and businesses pay taxes on the appreciation of assets such as stocks, homes, or land once sold. Ramaswamy believes this makes sense because a profit has been realized until those assets are sold. Documents may suggest higher value, but the asset holder won’t see actual cash. However, Harris’ plan would change that.