In recent news headlines we have uncovered a new possible tax for the wealthy us individuals to be introduced ranging from 39.6% to 44 %. It looks like US President Joe Biden will allegedly propose almost doubling the capital gains tax rate for wealthy individuals across US. The tax increase would be around 39.6%, which cumulated with the existing taxation on investments income would mean that investor’s federal tax rates could soon get as high as 44%, according to the major headlines today.
Better taxing of the rich people in US was one of the president’s campaign promise
Better taxing of the rich people in US was one of the president’s campaign promise and it looks like it will really come to pass in the near future. This will mean a lot of tax returns for the government as for example the richest 1 % people in the states added over 4 trillion dollars in their wealth only in the year 2020. This is in part thanks to the growing value of stocks and indices reaching record highs through the year 2020 end and the start of 2021.
The reason for this alleged plan to raise taxes
The reason for this alleged plan to raise taxes on the wealthy Americans is to fund about one trillion us dollars for childcare, pre-kindergarten education and paid leave for workers. If this taxation change is true then it would still need to go through Congress first, where the Democratic Party holds a smaller majority and they would have to win support from the Republican party as well.
Details on new taxes on the wealthy could be announced as soon as next wee
Details on new taxes on the wealthy could be announced as soon as next week as headlines suggest. The plan for this year seems to be the release of a so called American Families Plan. After unveiling a 2,3 trillion dollars infrastructure spending plan backed up with the new corporate tax increases, The American Families Plan is to be offering programs like Free Community College, Paid Family leave and Universal Childcare Pre-Kindergarten Education. The president is expected to fund the forthcoming plan with tax increases on wealthy households.
This Tax For The Wealthy Hike is welcomed by many common people
This Tax Hike is welcomed by many common people as they struggle with every day live. Meanwhile the US first 650 billionaires have a total calculated wealth estimated at 4.2 trillion us dollars. There are many studies done in this aspect that suggest that this 650 most wealthy Americans have their fortunes increased by about 44% since the pandemic started March 2020.
Today after news in the media headlines rose on reports of a tax increase on investments stocks tumbled a bit after. Stocks tumbled as investors reacted to reports that the Biden administration was weighing a new Tax For The Wealthy increases on wealthy investors. After this news headlines about the capital gains tax increase on the wealthy investors the index Nasdaq composite fell 1 % Thursday, giving up earlier gains.
Stocks like technology, and high growth stocks could lose some steam
Stocks like technology, and high growth stocks could lose some steam after the new capital gains tax plan if it gets in fruition but it seems Wall Street is skeptical President that the new tax proposal to increase capital gains taxes could pass the Senate.
It is expected that an increase of this proportion in capital gains tax could likely generate an increase in mergers and acquisitions among the affected companies to support the changes.
Investors will watch the market more closely after this Tax For The Wealthy news
Investors will watch the market more closely as this new taxation news unfolds and new investment strategies will have to be carried out to adapt to this new alleged tax hike. In my opinion this will not affect the market in a negative way and it will just balance a bit the difference in wealth distribution across Wall Street.
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