Vice President Kamala Harris just got smacked down a few pegs — metaphorically speaking — by someone who she thought was on her side, but is less supportive than a broken jock strap. I’m talking about a progressive Democratic congressman who has a super weird name. Ro Khanna from California. Khanna is not at all a fan of Harris pursuing a tax placed on unrealized capital gains, which she’s signaled she would support as part of the 2025 budget should she win the election in November.
Check out the deets from the NY Post:
“Let’s say you’re an entrepreneur, you create a company, it gets to $100 million or $200 million on paper. Now if you’re taxing that, you’re probably going to force that person to sell it,” Khanna, whose Silicon Valley-based district is the wealthiest in the US, told CNBC’s “Squawk Box.”
“Do you really want the entrepreneurs to be forced to sell their companies to larger institutions and to decline in value? I don’t think that’s what you want for a startup ecosystem,” Khanna continued, though he did not mention his fellow Californian by name.
For most capital assets, taxes are levied after their sale, meaning rich individuals can accrue more wealth as the value of the asset grows over time. By contrast, traditional income gets taxed by the government throughout each year. This has led to a strategy called “buy, borrow, die” in which wealthy individuals borrow against an asset to get cash from the unrealized capital gains without facing taxes on it. Many progressives have complained that the capital gains tax system in the US enables the rich to skirt their obligations to Uncle Sam.
JUST IN: Kamala Harris surrogate Rep. Ro Khanna went on CNBC this morning and SLAMMED HER PLAN to tax unrealized gains.
Her OWN SURROGATES dispose her plan..
— Chuck Callesto (@ChuckCallesto) September 4, 2024
Khanna went on to say on Wednesday that he understands why so many of his fellow partisans are now pushing so hard to collect additional taxes from all the rich folk, though he added, “This is not the right way to do it.”
“And also, 90, 95% of investments in startups fail,” the congressman said, “and so you’re going to disincentivize investments in those startups.”
Khanna provided an alternative to Harris’ nightmarish vision, suggesting that our government could tax loans the wealthy use to take advantage of the capital gains tax structure. Look, as far as I’m concerned, whenever you use the word “tax” you’re cussing and uttering blasphemy against Lady Liberty so I’m not a fan of any of this. But the fact that he’s turning on Harris just goes to show that she’s not nearly as popular as the media wants you to believe she is.
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