CNBC's "Squawk Box" hosts engaged in a heated debate with Bharat Ramamurti, an economic adviser to Vice President Kamala Harris, over the Biden-Harris tax proposal that would impose a tax on unrealized capital gains.
On Wednesday, the hosts of CNBC's "Squawk Box" squared off with Bharat Ramamurti, an informal economic adviser on Vice President Kamala Harris' campaign, over the controversial Biden-Harris tax proposal that includes a tax on unrealized capital gains.
Rebecca Quick and Joe Kernen, the show's hosts, vehemently opposed the proposal, arguing that it was unfair and potentially unconstitutional. They questioned the rationale behind taxing individuals on gains that had yet to be realized through the sale of an asset.
CNBC Hosts Spar with Harris Economic Adviser over Controversial Unrealized Gains Tax Proposal
Quick asserted that such a tax would essentially force people to pay taxes on income they had not yet received, while Kernen raised concerns about its potential legal implications.
Ramamurti defended the proposal, arguing that it would generate significant revenue for the government and provide more opportunities for Americans. He drew parallels to property taxes, which homeowners pay based on the value of their property, regardless of whether they sell it.
CNBC Hosts Spar with Harris Economic Adviser over Controversial Unrealized Gains Tax Proposal
However, Quick and Kernen vehemently disagreed with this comparison, maintaining that property taxes are considered "use taxes" that fund essential services such as schools and emergency services.
They argued that taxing unrealized capital gains would disproportionately impact wealthy individuals and could stifle economic growth by discouraging investment.
CNBC Hosts Spar with Harris Economic Adviser over Controversial Unrealized Gains Tax Proposal
Ramamurti emphasized the potential benefits of the proposal, claiming that the revenue generated could be used to invest in infrastructure, education, and other programs that would benefit all Americans.
The Biden-Harris proposal, which has been outlined in the recent budget proposal, would impose a 25% tax on unrealized capital gains for individuals with wealth exceeding $100 million. The plan also proposes raising the corporate tax rate from 21% to 28%.
Economists have expressed mixed reactions to the proposal, with some arguing that it could lead to increased tax revenues and reduce inequality, while others worry about its potential impact on investment and economic growth.
The Peterson Foundation, a nonpartisan think tank, has estimated that the unrealized gains tax, along with the substantial capital gains tax increase, could generate nearly $800 billion in new government revenue.
The debate over the unrealized gains tax is likely to continue as the Biden administration seeks support for its tax proposals. The proposal faces significant opposition from Republicans and some Democrats, who argue that it is unfair and could harm economic growth.
The outcome of the debate will have significant implications for the future of taxation in the United States, as it could set a precedent for further efforts to tax wealth and reduce inequality.
