In a recent discussion, Tom Wheelwright, CPA for Robert Kiyosaki and author of "Tax-Free Wealth," shed light on the complexities surrounding current tax proposals and their potential impacts. Here's a breakdown of what you need to know.
According to Robert Kiyosaki, "the government's greatest power is the power to tax." The value of the dollar is intrinsically tied to our requirement to pay taxes with it, making any shifts in tax policy critically impactful.
Starting a business is one of the most tax-incentivized investments, which explains why major corporations sometimes appear to pay little in taxes. The government provides these incentives to foster economic growth, but changing tax rates could shift this dynamic.
Recent tax proposals suggest increasing the capital gains tax rate from 20% to potentially 50% when combined with state taxes. This could heavily impact:
One of the more contentious proposals is the idea of taxing unrealized capital gains, which could affect anyone whose assets have increased in value, from homes to heirlooms, requiring annual appraisals.
These tax changes could lead to a number of consequences, including:
Tax regimes with similar policies, such as what was seen in France, often lead to economic migration or evasion, as those affected seek to preserve their wealth.
Though politically charged, these discussions highlight the necessity for informed public debate around taxation and fiscal policy. As Tom points out, while these proposals aim at the wealthy, their broader economic implications can ripple across all economic strata.