US Elections Are Getting Closer,What Impact Will It Have on Financial Markets
The US presidential election is getting closer, investors are on alert. This is because the contrasting economic policies of Kamala Harris and Donald Trump could have a significant impact on financial markets.
With important decisions regarding tax rates, regulations, energy policy, and trade, the potential for increased market volatility depends on who wins the White House and what the new balance of power in the US Congress will be like.
Although both candidates (Kamala Harris and Donald Trump) have stated that they want to achieve the same goals, especially creating jobs and increasing the US manufacturing base, their approaches to economic policy are very different.
Therefore, the financial market response will almost certainly be different depending on who finally wins the White House. Not only that, it is also important to consider the possibility of changes in the dominance of power on Capitol Hill, because 33 of the 100 senators and all 435 delegates in the House of Representatives will also be running for re-election this November.
Kamala Harris generally supports higher taxes, especially on the wealthy. He supports proposals to increase the top income tax rate to 39.6% (from 37%) and introduce a new minimum tax of 25% on high net worth individuals over $100 million, including on unrealized capital gains. He also proposes raising the capital gains tax to 28% (from 20%) and raising the corporate tax rate to 28%.
Donald Trump, meanwhile, says lowering taxes is a cornerstone of his economic platform. He supports lowering taxes primarily for ideological reasons, but also sees it as a way to encourage manufacturing companies to keep production at home and not outsource production to other countries. He has promised to lower the corporate tax rate to 15% (from 21%) for companies producing in the United States. Trump also wants to extend all of the individual tax cuts that were enacted in 2017, but are projected to expire in 2025.(Cay)
Source: CNBC
