A top Democrat in Congress is proposing a new tax on stockholders.
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Senator Ron Wyden (D-Ore.) has put forth a plan to tax "unrealized" capital gains annually instead of when those assets are sold.
Wyden says he plans on further elaborating on the specific details of his proposal, but many of his fellow lawmakers have taken issue with the plan.
“This is a horrific idea,” Stephen Moore, President Trump’s pick to serve on the Federal Reserve’s Board of Governors, said on FOX Business' “Bulls & Bears” Wednesday. “It's a tax on your wealth. It's a tax on any gain on your stocks. Think about what that would mean for just average Americans who own stocks. Think about the nightmare about what that would mean in terms of the complexity of your taxes.”
If this law were to go into effect, it would no longer allow Americans to pass on stocks to their heirs free of charge. Now, anyone who receives stocks as an inheritance would have to pay taxes on the gift. Wyden claims this bill will help create a more economically egalitarian society.
Critics of the bill say that if Democrats want to tax stockholders there may be a solution, such as taxing an individual when they initially purchase their stocks instead of taxing them for successfully investing in a growing company.