Vivek Ramaswamy warns, Kamala Harris' tax plans will lead US to an ‘economic calamity’
Vivek Ramaswamy calls out Democrats' views on tax on unrealised capital gains, calls it an economic calamity
Vivek Ramaswamy has issued a stark warning about the economic dangers he believes would arise if Vice President Kamala Harris is voted into power and implements her proposed tax strategy. At the centre of his concern is Harris’s support for a tax on unrealised capital gains—a policy that could, according to Ramaswamy, trigger an economic calamity.
Under the current tax system, individuals and businesses only pay taxes on the appreciation of assets like stocks, homes, or land once those assets are sold. This makes logical sense, Ramaswamy argued, because until the asset is sold, no actual profit has been realised—on paper, the value might be higher, but the asset holder hasn't seen any real cash.
"Biden and Harris want to change that. In 2022, they proposed a "minimum tax of 20 percent on total income, generally inclusive of unrealized capital gains.”
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However, Ramaswamy pointed out that the Biden-Harris administration has been pushing to change this long-standing principle.
"Biden and Harris want to change that. In 2022, they proposed a "minimum tax of 20 percent on total income, generally inclusive of unrealized capital gains.”
In 2022, Biden administration proposed a "minimum tax of 20 percent on total income, generally inclusive of unrealized capital gains."
He further claimed, by 2023 and 2024, that figure had been bumped up to 25%. While these proposals have not yet become law, Ramaswamy emphasized that Harris's campaign has shown no sign of backing away from the idea.
It's important to note that Kamala has been distancing from several Biden government policies and has not indicated any stance on unrealised capital gains tax.
"Imagine you’re a family farmer or a small business owner," Ramaswamy told his audience, "and your property goes up in value due to factors beyond your control—market conditions, inflation, or simply the passage of time. Or think about a startup founder I know personally, who comes from a middle-class family and had a brilliant idea for a consumer technology company. On paper, that company is worth a lot, but all his money is tied up in the business. He doesn’t have spare cash lying around."
Ramaswamy painted a vivid picture of the potential consequences: "Under Harris’s plan, the IRS won’t care that your newfound ‘wealth’ only exists on paper. They want cash. This would force people like that startup founder to sell shares of their company prematurely, just to pay a tax bill on money they haven’t actually made. The same goes for someone with long-term capital gains in their public stock portfolio—they’d be forced to sell just to meet their tax obligations."
The real danger, Ramaswamy warned, lies in the broader economic implications of this policy. "This creates a vicious cycle of what's known in capital markets as 'forced selling.' People would have to sell off assets to pay their tax bills, and when everyone is forced to sell at the same time, it triggers a downward spiral in asset prices. It's the perfect formula for a politician-made market crash."
Ramaswamy also noted that even some thoughtful Democrats have been reluctant to support this policy outright, instead arguing that it’s unlikely ever to be enacted.
"It’s significant that even thoughtful Democrats won’t support this policy on the merits, they just insist it’ll never actually happen. Not exactly a ringing endorsement," he quipped.