The only thing the media is supposed to be scared of is anything Trump or conservative. But Kamala Harris’ potential tax policy is being called “scary” and “unconstitutional”. She’s keeping her policy positions close at hand because they’re so far left. This is a tax on unrealized gains for American households with income starting at $100 million. It’s even imposed if the asset doesn’t get sold.
Something else the media sees
It’s been the role of the news to be favorable to anything Democrat but there maybe many on the left that might be uncomfortable with this. If the market shifts enough the profit from that sale might go exclusively to the feds with the seller seeing none of it.
Bharat Ramamurti is an informal economic advisor to Harris. He tried to defend it on CNBC but hosts Rebecca Quick and Joe Kernen said absolutely not.
Ramamurti said we’re already doing this in the form of a property tax. “I think that this reaction to unrealized gains is a little funny, given that I bet that the majority of people watching right now are already paying a tax on unrealized gains. It’s called a property tax.”
CNBC news media said no
Quick responded, “It just doesn’t seem fair in any sense of the word. Your value of your home never moves the way a stock moves, the way something else moves that you don’t sell. It’s also, property tax is a ‘use tax.’ You’re paying for the schools, you’re paying for the emergency services. Those are things that make absolute sense.”
Both hosts thought it was unconstitutional. Forbes had an article from senior contributor Robert Wood that said it would be impossible to implement and scary.
Valuation disputes are huge. Wood also noted the slippery slope we’d be on.
The media maybe wealthy
“Apart from policy, there are administrative issues galore. How do you go about valuing everything every year to be taxed? Public company stock would be straightforward. But most assets could be a nightmare, and who in the end gets to carry the day on value? Disputes about value in tax cases are legendary and voluminous. Nearly every estate tax case with the IRS includes valuation disputes, often with competing experts. In income tax cases, charitable contributions of noncash assets such as real estate or crypto often also end up in major valuation fights. What is arguably the scariest part of this idea? What if this opens the door to a more generalized effort by the government to tax you on something that you still own? Right now the proposal is only to use this wealth tax for the truly wealthy. Not just billionaires, but also anyone with at least $100 million. Once we start down this path, could we some years from now face a tax like this for someone with $20 million, $10 million, even $1 million? You get the idea.”
Wood reminded that the federal government has a limit to what it can tax.
“Even if the ‘billionaire’s tax’ to hit anyone at $100 million passes, there could be court challenges based on what the U.S. Constitution says about the government’s taxing power. The Supreme Court has not fully ruled on a question like this, although one recent guidepost came in a 2024 tax case, Moore vs. USA, in which the Supreme Court upheld a tax on undistributed foreign assets.”
The government isn’t supposed to be able to tax something that hasn’t even been sold yet.
