Democrat Presidential fronrunner Hillary Clinton put forward a plan of overhauling capital gains taxes in order to secure a long-term growth. Her aide said on Monday that she plans to secure the growth by taxing short-term investments at higher rates.
Hillary Clinton made her first major campaign speech aiming at economic policies last week in New York and promised to break Wall Street and impose tougher financial regulations.
The change in policy comes after her bid for the White House in 2008 Elections, when she promised not to raise the capital gains tax above 20%, if not at all. However, after pressures of more liberal Democrats and the Democratic Presidential contendor U.S. Senator Bernie Sanders of Vermont, she switched her position in order to expand voting opportunities, as well as have a more liberal economic agenda, eve though she and her husband, former President Bill Clinton, have strong ties to Wall Street.
Details of the capital gains taxation plan are still not available for the general public, although according to Reuters an aide with the Democratic campaign of Hillary Clinton has stated that the plan is yet to be finilazied, but said that the plan would create a sliding rate scale based on the length of an investment, whether it is short-term or long-term.
The present maximum capital gains tax rate is 23.8 percent and Clinton proposes that during her presidency the rate would rise to a 28 percent at least. Earlier this year, President barack Obama has proposed that the rate should be 28 percent and would be aimed at the highest earners. According to Reuters and The Wall Street Journal, Clinton is set to outline the plan in a speech this week.
According to Reuters, the proposal contains some other rate changes, such as lowest rates for investments that are for a long-term. The investments that are for aa short-term period of less than a year will be taxed at regular income tax rates, as they currently are.
This decision comes as a component of the plan to take focus away from fast profits in capital markets. This includes the capital gains which are acquired with sales of capital assets like shares or real estate.
The package of measures insures that the tranformation is aimed at securing growth on the long-term and the former Senator and Secretary of State is set to propose another set of measures that would me aimed for risk-taking and long-term benefits of shareholder activism, as well as the role of executive compensation. Clinton plans to make separate speeches about financial institutions regulation and income inequality.