Vice President Harris made a policy break from President Biden on Wednesday by calling for a lower tax increase on capital gains than what the president had proposed.
Harris said during a campaign speech in New Hampshire said she wants to increase the capital gains tax to 28 percent for those with $1 million or more in income, up from its current effective level of 23.6 percent.
Harris's proposal is well shy of the 44.6 percent rate proposed in a budget update from the Biden administration in July. It is also lower than the proposed increase to 39.6 percent included in the president’s most recent budget.
“If you earn a million dollars a year or more, the tax rate on your long-term capital gains will be 28 percent under my plan, because we know when the government encourages investment, it leads to broad based economic growth,” Harris said in New Hampshire.
Harris gave more details on her economic plans during the Wednesday speech, proposing to increase a tax deduction for new businesses from $5,000 to $50,000.
Greater “access to capital,” support for “business incubators” and more federal contracts with small businesses were additional elements of her plan.
Harris also mentioned administrative changes to business tax filing, “similar to how individuals can take a standard deduction.”
Harris’s smaller tax increase for capital gains is a gesture of compromise toward Republican positions, which typically do not favor any tax increases on capital. The moderation reflects a movement toward the U.S. political center that is typical of much late-in-the-race campaigning.
In a Tuesday New York Times op-ed, Democratic strategist James Carville encouraged Harris to distinguish herself from Biden.
“For Ms. Harris to break from Mr. Biden more explicitly than she has done so far would not be an insult to his legacy, just as Mr. Biden’s objectively more progressive policy agenda was not an insult to Mr. Obama’s,” Carville wrote.
