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WASHINGTON – President Joe Biden will roll out a plan to raise taxes for wealthier Americans and their investments to fund roughly $ 1 trillion in child care, universal preschool education and paid time off for workers, said sources close to the proposal.
The plan, which is part of the White House push for a major overhaul of the U.S. tax system to make the rich and big business pay more, calls for raising the top marginal tax rate to 39.6 % versus 37% and almost double capital gains taxes. at 39.6% for people earning more than $ 1 million, sources said this week.
This would be the highest tax rate on capital gains taxes, which are paid primarily by the richest 1% of Americans, since the tax was introduced in 1913.
News of the proposal sparked sharp declines on Wall Street, as the benchmark S&P 500 fell 1% in the early afternoon, its biggest drop in more than a month.
Such a hike would have to come through Congress, where Biden’s Democratic Party holds narrow majorities and is unlikely to win the support of Republicans.
“If he had a chance to pass, we would be down 2,000 points,” said Thomas Hayes, chairman and managing director of the Great Hill Capital LLC hedge fund, referring to stock indexes.