Under President Biden's tax plan, 13 states and D.C. would have a top combined capital gains tax rate at or above 50%:
56.7% CA
54.3% NY
54.2% NJ
53.3% OR
53.3% MN
52.4% DC
52.2% VT
50.7% HI
50.6% ME
50.4% CT
50.3% ID
50.2% NE
50.2% MT
50.0% DE
(58.2% NYC)
(57.3% Portland, OR)
President Biden’s #AmericanFamilyPlan will likely include a large increase in the top federal tax rate on long-term capital gains and qualified dividends, from 23.8% today to 39.6% for higher earners.
When including the net investment income tax, the top federal rate on capital gains would be 43.4%.
Rates would be even higher in many U.S. states due to state and local capital gains taxes, leading to a combined average rate of 48% compared to about 29% under current law.
Raising the top capital gains tax rate to 39.6 percent for those earning over $1 million would reduce federal revenue by about $124 billion over 10 years, according to our General Equilibrium Model.
Compare top marginal capital gains tax rates under current law vs. the Biden proposal in each state here: taxfoundation.org/biden-capital-…
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President Biden’s #AmericanFamilyPlan will likely include a large increase in the top federal tax rate on long-term capital gains and qualified dividends, from 23.8% today to 39.6% for higher earners.
When including the net investment income tax, the top federal rate on capital gains would be 43.4%. Rates would be even higher in many U.S. states due to state and local capital gains taxes, leading to a combined average rate of nearly 49% compared to about 29% under current law.
A capital gains tax is levied on the profit made from selling an asset and is often in addition to corporate income taxes, frequently resulting in double taxation.
Capital assets generally include everything owned and used for personal purposes, pleasure, or investment, including stocks, bonds, homes, cars, jewelry, and art.
NEW: Modernizing rental car and peer-to-peer car sharing taxes for a post-pandemic future: buff.ly/3xbDjxP@GS_Watson
As state economies reopen and travelers consider options for their first travel experience since the pandemic started, states should ensure that their tax codes and revenue options don't stand in the way of a robust recovery.
Unlike other excise taxes, rental car excise taxes are not imposed to reduce a harm/ensure drivers are paying for infrastructure. Rather, revenue is used for unrelated purposes and the taxes create a byzantine structure of taxes/fees that dissuade travelers from using rental cars
Raising the U.S. corporate tax rate to 28 percent would reduce GDP by $720 billion over ten years: analysis buff.ly/3n62Bsu@ericadyork
In our new book, Options for Reforming America’s Tax Code 2.0, we illustrate the economic, distributional, and revenue trade-offs of 70 tax changes, including President Biden’s proposal to increase the corporate tax rate to 28 percent.
The Options guide presents the economic effects we estimate would occur in the long term (20-30 years from now), but we can also model the cumulative effects of a policy change—providing more context about how the effects of a higher corporate income tax rate compound over time.
Both the federal government and the states raise revenue for infrastructure spending through taxes on motor fuel and vehicles. States also collect fees from toll roads and other road charges.
However, neither the federal government nor the vast majority of states collect enough taxes through these levies to cover infrastructure-related spending.
The legalization and taxation of recreational marijuana remains one of the hottest trends in state taxation.
Currently, 16 states and D.C. have passed bills or approved ballot measures that allow for the sale of recreational marijuana: tax.foundation/3cFu2Wm
Alaska, Arizona, California, Colorado, D.C., Illinois, Maine, Massachusetts, Michigan, Montana, Nevada, New Jersey, New York, Oregon, South Dakota, Vermont, Washington have passed bills or approved ballot measures that allow for the sale of recreational marijuana.
And more states are poised to pass legislation this session.
In total, actual recreational marijuana sales are happening in 11 states.