WASHINGTON, DC - This week, Rep. Warren Davidson (R-OH) and Sen. Ted Cruz (R-TX) introduced a bill to protect investors from inflation.
The Capital Gains Inflation Relief Act (H.R.5838) would amend the U.S. tax code to index the basis for capital gains taxes for inflation. By adjusting the investment basis for inflation, Congress would protect Americans' capital gains just as tax brackets, the standard deduction, and certain income thresholds for tax credits are adjusted for inflation.
Under President Biden, inflation has risen from 1.4 percent to 5.4 percent. This invisible tax is eroding the value of the dollar, eating into Americans' savings, and threatening the dollar's status as the world reserve currency. Americans living on a fixed income are most affected by this disastrous monetary policy.
After introducing the bill, Rep. Davidson made the following statement.
"The best thing Congress can do to protect Americans' savings is return to sound monetary policies that preserve the U.S. dollar as a store value and an efficient means of exchange. This combination has made the dollar the world’s reserve currency. Current policies erode that and cause inflation. To mitigate that impact, Congress should alter the tax code so that investors with long-term capital gains don't pay taxes on the portion of the gain that simply reflects inflation. Americans should not be taxed for the economic distortions caused by Washington D.C.’s flawed policies."
After the bill's introduction, Sen. Cruz made the following statement:
The Capital Gains Inflation Relief Act (H.R.5838) would amend the U.S. tax code to index the basis for capital gains taxes for inflation. By adjusting the investment basis for inflation, Congress would protect Americans' capital gains just as tax brackets, the standard deduction, and certain income thresholds for tax credits are adjusted for inflation.
Under President Biden, inflation has risen from 1.4 percent to 5.4 percent. This invisible tax is eroding the value of the dollar, eating into Americans' savings, and threatening the dollar's status as the world reserve currency. Americans living on a fixed income are most affected by this disastrous monetary policy.
After introducing the bill, Rep. Davidson made the following statement.
"The best thing Congress can do to protect Americans' savings is return to sound monetary policies that preserve the U.S. dollar as a store value and an efficient means of exchange. This combination has made the dollar the world’s reserve currency. Current policies erode that and cause inflation. To mitigate that impact, Congress should alter the tax code so that investors with long-term capital gains don't pay taxes on the portion of the gain that simply reflects inflation. Americans should not be taxed for the economic distortions caused by Washington D.C.’s flawed policies."
After the bill's introduction, Sen. Cruz made the following statement:
“The Biden administration’s inflation crisis is causing prices to skyrocket and destroying the purchasing power of Americans’ hard-earned dollars. By indexing capital gains taxes to inflation, we are protecting hardworking Americans from being punished for this administration’s reckless spending and the cruel tax of inflation it created. This bill would encourage people to invest capital in growing businesses, helping job creators hire more people and raise wages when Americans need it most. I will continue to lead the fight in the Senate for fiscal sanity as this administration threatens to destroy the wealth of Americans.”
Americans for Tax Reform President, Grover Norquist also expressed support for the bill, citing its timeliness as inflation continues to rise.-###-