On Wednesday’s broadcast of CNN’s “Laura Coates Live,” CNN Economics and Political Commentator, Washington Post columnist, and “PBS NewsHour” Special Correspondent Catherine Rampell stated that while there are abuses and unfairness within the capital gains tax system, the proposal from 2024 Democratic presidential candidate Vice President Kamala Harris is likely to be “unworkable” at an administrative level.
Rampell said, “If you’re a really rich person, you can leave your assets to your heirs and whatever gains you saw over the course of your lifetime will be wiped out, and everything gets reset when that stuff is inherited, it’s something called the step-up basis. And so, as a result, you do end up with a lot of appreciated assets, whether it’s a stock portfolio or an art collection or anything else, where the gains never get taxed. And I do think that’s a problem. The specific proposal that we are referring to about taxing those unrealized gains today is basically something that the Biden administration has come up with. It’s not new to Kamala Harris as a presidential candidate, per se. And I think it would probably be kind of administratively unworkable, the idea that you, like, tax the gains as they are being accrued, even if the stuff never gets sold or the person who owns them never dies and passes them onto their heirs.”
She added, “I think there are better ways to get at this sort of unfairness in the system, like get rid of the step-up basis, like, when somebody dies, treat that as a realization event. So, it’s all technical. But I do think it is unfair that there are a lot of rich people out there who can kind of legally game the tax code and never see taxes on all of the money they’ve made over the years.”
Follow Ian Hanchett on Twitter @IanHanchett