Harris tries tax triangulation to build distance from Biden
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Vice President Harris arrives to speak at a campaign event in North Hampton, N.H., on Wednesday. Photo: Joseph Prezioso/AFP via Getty Images
Vice President Kamala Harris chose a rather obscure part of the federal tax code — the top rate for capital gains — to make her first big move toward the center of the 2024 political conversation.
Why it matters: Harris' call for Americans making $1 million a year to pay a 28% capital gains rate marked a symbolic departure from President Biden, who prefers a higher 39.6% tax.
- The current top rate is 20%, plus a 3.8% Medicare surcharge.
The big picture: She's spent the first six weeks of her presidential campaign embracing Biden's positions as her own on tax policy and some other areas.
- But on Wednesday, she had a clear message for the business community: "Comrade Kamala" she isn't, even for Americans making more than $1 million a year — a group Biden once described as the top "three-tenths of 1% of all Americans."
Zoom in: Harris unveiled her new tax policy at an event in the "Live Free or Die" state of New Hampshire, known for its aversion to taxes.
- "We will tax capital gains at a rate that rewards investment in America's innovators, founders and small businesses," Harris said in Portsmouth.
- She paired her new capital gains position with a fresh proposal to increase the tax deduction available for new small businesses from $5,000 to $50,000.
- "One of my highest priorities will be to strengthen America's small businesses," she said.
Between the lines: As she has filled in the gray areas of her tax policy, Harris has mostly photocopied the president's proposals.
- Biden has called for taking the corporate tax rate from 21% to 28%. Ditto Harris, abandoning her old 35% preferred rate.
- Like Biden, she supports a minimum tax for billionaires.
- She also wants to quadruple taxes on stock buybacks.
Flashback: For Biden, taxing capital gains as regular income — which is where the 39.6% rate comes from — has always been a matter of basic economic fairness.
- "We're going to get rid of the loopholes that allow Americans who make more than $1 million a year to pay a lower rate on their capital gains than working Americans pay on their work," he said in his first address to a joint session of Congress.
- He included the proposal in every one of his budgets.
Zoom out: As she cautiously flushes out her policy agenda, Harris has mostly modified her old positions from her 2019 presidential campaign to align with Biden's.
- Biden supported the bipartisan Senate immigration bill — and even building some of Trump's border wall. Harris used her acceptance speech to heartily agree.
- Biden said he wouldn't ban fracking. Harris said the same.
- Asked to explain her apparent flip-flops, Harris told CNN's Dana Bash, "My values have not changed."
The intrigue: When Harris has tweaked Biden's positions, she's mostly moved further to the left.
- That instinct has been most pronounced with the one issue that has bedeviled the Biden administration more than any other: inflation.
- On the high cost of housing, she increased Biden's $10,000 first-time homebuyer credit to $25,000.
- Like Biden, she's outraged by corporate greed. But she went a step further and called for a ban on price gouging by food producers and grocery stores.
