Will doubling the capital gains tax derail the market rally? The markets plunged, then surged on the news that President Biden might propose a new major tax hike for the wealthy. Lewis Krauskopf of Reuters describes how the hike could ultimately affect stocks. Our booming economy may soon hit the brakes. Lucia Mutikani reports how economists see market forces slowing the economic expansion. While the headlines focus on tax hikes for the rich, they’re ignoring tax cuts for nearly everyone else. People earning up to $75,000 may pay no federal income taxes at all this year.
Investors Doubt U.S. Capital Gains Tax Plan Alone Can Derail Market Rally — Reports that President Joe Biden would seek to nearly double the capital gains tax to 39.6% for wealthy individuals caused the markets to temporarily swoon. But stocks rebounded as investors pointed to reasons why such a policy alone would not threaten the market rally. Read more…
U.S. Manufacturing, New Homes Sales Underscore Booming Economy — The economy is being boosted by the White House’s massive $1.9 trillion COVID-19 pandemic rescue package and increased vaccinations against the virus. But the strong demand is pushing against supply constraints. The pandemic has disrupted labor at factories and their suppliers, causing shortages that are boosting prices of materials and other inputs. Read more…
Why Middle Class Taxpayers Could Owe Nothing This Year — New estimates by Congress’s official forecasters show that these tax cuts — included in the Democrat’s March stimulus package — will drive down tax rates on low and middle-income people. In fact, those earning less than $75,000 may owe nothing in federal income taxes. Read more…
John R. Day, Bill Ennis, Stephanie Hall, and Matt Heller