Unrealized capital gains go untaxed. The richest Americans don’t pay their fair share of income taxes for the simple reason that a lot of their income is never taxed. Dal Wall Street Journal.
The richest Americans don’t pay their fair share of income taxes for the simple reason that a lot of their income is never taxed. Missing from the statistics cited in your editorial “How America Soaks the Affluent” (March 4) are unrealized capital gains, which provide very real economic benefits—including the ability to borrow against them at cheap rates—but can avoid taxation forever. This omission in our tax system often allows billionaires to pay little or nothing in taxes. President Biden and his fellow Democrats are trying to fix it through a billionaire income tax and reforms to capital-gains-tax rules.
Many Americans want the rich and corporations to pay a fairer share of taxes not because of “posturing in Washington” but because of their correct perception that wealth and its attendant political power are becoming more concentrated in fewer hands and are being passed down essentially tax-free to future generations. In addition to raising adequate revenue for essential public purposes, a truly progressive tax system would curb such dynastic tendencies. Our tax code needs reforming along the lines proposed by Democrats to properly perform those functions.
