Here's where Kamala Harris could stand on tax policy, experts say
With President Joe Biden officially out of the election, experts are watching for tax policy from Vice President Kamala Harris, the Democratic frontrunner
With President Joe Biden officially out of the election, experts are watching for tax policy from Vice President Kamala Harris, the frontrunner for the Democratic nomination.
While Harris has yet to outline her economic agenda, voters could see similar themes to Biden's proposals, which have called for higher taxes on the wealthy and corporations, experts say.
Ahead of the 2020 presidential election, Harris shared many of Biden's priorities but voiced distinct proposals before her campaign ended in December 2019.
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Broadly speaking, it seems like Harris would be "largely on board" with most, if not all, of what Biden has been pushing, "especially in the big picture," said Garrett Watson, senior policy analyst and modeling manager at the Tax Foundation.
If Harris becomes the Democratic nominee and leverages the Biden campaign's infrastructure and staff, it could limit her ability "to go in a way different direction," he said.
The Harris campaign did not immediately respond to CNBC's request for comment.
Here's what to watch from Harris when it comes to tax issues, according to policy experts.
Expiring Trump tax cuts and Biden's pledge
With trillions of tax breaks expiring after 2025, plans for tax policy and the federal budget deficit are key issues Harris will need to address, experts say.
Enacted by former President Donald Trump, the Tax Cuts and Jobs Act, or TCJA, of 2017 temporarily lowered federal income brackets, raised the standard deduction and boosted the child tax credit, among other changes.
Trump wants to fully extend expiring TCJA provisions, including deeper cuts to corporate taxes. Meanwhile, Biden wants to renew tax breaks only for those making less than $400,000.
One big question is whether Harris will adopt Biden's pledge not to raise taxes on anyone making less than $400,000, said Andrew Lautz, associate director for the Bipartisan Policy Center's economic policy program.
"That's a big one with significant consequences," for future Democratic tax proposals and TCJA negotiations, he said.
Focus on the child tax credit
During the 2020 campaign, one of Harris' key proposals was the LIFT the Middle Class Act, which would have offered a refundable tax credit worth up to $3,000 for single filers and $6,000 for married couples filing jointly.
However, Biden and Democrats have been focused on the child tax credit, with an expansion passed in the House in February. That could be another priority for Harris this election, Watson said.
"Whereas the last administration gave tax cuts to billionaires, we gave tax cuts to families through the child tax credit, which cut child poverty in America by half," Harris said at a political event in North Carolina last week, before Biden left the race.
The American Rescue Plan boosted the maximum tax break to $3,000 or $3,600 per child, up from $2,000, and sent monthly payments to families. As a result, the child poverty rate fell to a historic low of 5.2% in 2021, largely due to the expansion, a Columbia University analysis found.
After pandemic relief expired, childhood poverty more than doubled in 2022, jumping to 12.4%, according to the U.S. Census Bureau.
This story originally appeared on: CNBC - Author:Kate Dore, CFP®
