The Senate Budget Committee held a hearing on June 12 focused on increasing taxes on capital. Topics brought up by Democrats (in a majority on the committee) included taxing carried interest as income, raising the corporate alternative minimum tax, increasing taxes on stock buybacks, and instituting taxes to target unrealized gains.
Most of the hearing focused around outlining previously held positions, though retiring Sen. Mitt Romney, R-Utah, endorsed possible changes to the step-up in basis for inherited assets. Overall, there was broad discussion around how to reduce structural deficits for the federal government, as Congress sets the table for a potentially historic fiscal debate in 2025. Though there were few forward-looking specifics due to the hearing’s timing, as campaign season begins, both parties took the opportunity to highlight policy contrasts or criticize previous tax law or proposals of the other.
As Election Day draws closer there may be more hearings at this and other committees with the aim of drawing contrasts between Democrats and Republicans over taxes. While the hearings are often more focused on messaging than new policy ground, ideas from them can gain traction or provide some forward-looking idea of what to expect in the future.
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