Debate over push for new tax on the wealthy
Oregon Senator Ron Wyden (D) reviving plans to make capital gains taxes due annually, a move some Democrats tell FOX Business is highlighting America's cash flow problem.
“We're spending way more money, billions of dollars more, a year than what we are actually bringing in in revenue. We've got a debt of $22 trillion, a record debt that has only skyrocketed under this administration. So Democrats are trying to come up with a solution to bring some sanity back,” Jon Summers, a former communications director to former Nevada Senator Harry Reid, told Connell McShane on “Cavuto: Coast-to-Coast” Wednesday.
Fiscal hawks have balked on increase spending in the federal budget, but others suggest that the federal budget spending remains untouched.
“Democrats have not talked about reducing entitlements, or dealing with them at all. They want to expand them. So why not introduce a way to increase revenue, thinking that the populist wave on both the left and right would support that?” Independent Women's Forum Patrice Lee Onwuka said.
Under Wyden's proposal, capital gains would be taxed annually based on how much assets have gained in value. Gains are currently taxed only when assets are sold at a top rate of 23.8 percent instead of the 37 percent for ordinary income.
Former Colorado state senator Ted Harvey told FOX Business this latest proposal shows that Democrats are becoming more serious about increasing the size of government.
"They will look at every single pot of money to be able to do that, even if it means going after those who are the job creators in this economy," he added.
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Capital gains are taxed when a capital asset, such as stocks, bonds, precious metals and real estate, is sold. The tax is calculated on the profit or positive gain between the original purchase price and the sale price of the asset.