President Joe Biden will propose nearly doubling the capital gains tax rate for wealthy Americans to 39.6%, Bloomberg News reported Thursday. Coupled with an existing surtax on investment income, means that federal tax rates for investors could be as high as 43.4%, according to people familiar with the proposal.
Bloomberg said the plan would boost the capital gains rate to 39.6% for those earning $1 million or more, an increase from the current base rate of 20%.
Biden is expected to include the proposal as part of his American Families Plan to be presented before a joint session of Congress next week.
The increases are unrelated to the corporate tax increase from 21 percent to 28 percent that Biden proposed for his $2.3 trillion infrastructure plan.
Stocks fell with the news with the S&P 500 Index down 0.7% as of 1:43 p.m. The Nasdaq Composite fell 0.6% after rising as much as 0.5%. Ten-year Treasury yields erased gains.
NEW: Biden to propose almost doubling the capital gains tax rate for the wealthy to 39.6%. Coupled with an existing tax on investment income, that means that federal tax rates for investors could be as high as 43.4%.
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