President Biden and a strong Democratic federal legislature can lead to a fair tax code without corruption. It is an interest proposal so far that is on the table and addresses the deficit.
Many economists, including Larry Summers supports many aspects of the proposed tax reform. Some actually applaud the current proposals. Larry Summers has one objection and I agree with him to some extent and that is in regard to increased stock values, but, unrealized income.
If I may?
There is a measure in the proposals that want to tax increased values of stock holdings. That is not income, but, further investment. If an investor allows increased value to stand without taking profit that is further investment. I think it is folly to bring such a proposal to law.
Increased values of stock holdings is an asset and not an income. When stocks are sold for profit it then becomes income and should be exposed to taxes.
As an added value asset a lot of options exist within the investment network and through banking including loans, both business and personal. Those loans or other use of these value added assets create tax deductions in the way of interest and fees. Those are legitimate uses of the tax code and should not change.
The value added assets must be viewed, no matter what form they exist; including home ownership; as assets and not income. Value added assets are fluid and can lose value in the future. While a loss in value will be a deduction and not income it is a concern for corruption.
If such value added stock tax were to become law it would open up the tax code to manipulation. There is nothing preventing an investor to throw money at stocks losing value while other stocks increase in value. This would put a huge hole in the tax code where manipulation would result in larger national deficit. Such a dynamic would affect the USA code on Moodys and the like. I think a great deal of caution to such concepts has to be viewed as excessive overreach in law.
The new tax code should have a reasonably predictable income for the country year after year. Those types of tax incomes to the USA treasury will stabilize the reliability of the USA, hence translating that stability to allied as well.
I think the Democrats are the absolute best party to pass this new tax code into law. They will listen to the people and provide stability to the USA treasury. The tax code will finally be fair while eliminating current corruption such as offshoring. The Democrats must pledge to bring about a fair tax code while eliminating corruption and regulations that do not service the country well.
