Stocks drop as Biden proposes capital gains tax up to 43.4%

Stocks wobbled between small gains and losses Thursday as investors continue to focus on company earnings reports and the economic recovery.

Earnings are a key focus for investors, as the bulk of companies in the broad S&P 500 spend the next few weeks reporting their financial results. Wall Street is hoping to get a better sense of just how much companies in various sectors are benefiting from the economic recovery.

AT&T rose after releasing results that beat expectations, helped by higher wireless phone charges as well as the success of its streaming service HBOMax. Equifax also rose after reporting strong results.

 Many stocks sharply dropped to new session lows Thursday after Bloomberg reported President Biden is eyeing a capital gains tax as high as 43.4%.

Bloomberg says under Biden’s proposal, “people earning $1 million would pay 39.6% plus Obamacare levy,” and “total tax rates for New Yorkers and Californians could top 50%.”

For Californians, the combined state and federal capital gains rate could be as high as 56.7%

According to Bloomberg, “Biden is expected to release the proposal next week as part of the tax increases to fund social spending in the forthcoming ‘American Families Plan.'”

The full report from Bloomberg can be read here.

Categories: National & International News, Politics