[ONLINE] Should capital gains be taxed at same rate as ordinary income?

If you buy an asset and then later sell it at a higher price, the difference between the price you sell at and the price you bought at is called a capital gain.

The federal government taxes capital gains at a maximum rate of 23.8% on assets that have been held for more than a year. Ordinary income, such as wages, salaries, rents, royalties, interest, and capital gains on assets held for less than a year, is taxed at a maximum rate of 40.8%. (Both of these top rates include the 3.8% Net Investment Income tax for people with the highest incomes.) For most of the history of the federal income tax, including now, long-term capital gains have been taxed at a lower rate than ordinary income.

Our question for debate is:
Should capital gains be taxed at the same rate as ordinary income?

ARGUMENTS FOR THE MOTION:
Supporters argue that capital gains should be taxed at the same rate as ordinary income because:

• the benefits from a lower rate of tax on capital gains go overwhelmingly to the wealthy;
• because of loopholes, a large share of wealthy people's capital gains escapes taxation;
• there is no evidence that cutting capital gains taxes would help the economy.

For further reading: "Capital Gains Tax Preference Should Be Ended, Not Expanded", by the Center for American Progress.

ARGUMENTS AGAINST THE MOTION:
Opponents argue that capital gains should be taxed at a lower rate than ordinary income because:

• taxes on capital gains are not indexed for inflation, so if the value of your asset only keeps up with inflation, you're effectively paying a tax on inflation when you sell it;
• a capital gains tax is a double tax: corporations pay taxes on profits, and then when these profits are realized by individual investors as capital gains, the investors are taxed again on the same income;
• a low tax on capital gains encourages savings and increases economic growth, and even raises more tax revenue.

For further reading: "Why Capital Gains are taxed at a Lower Rate", by the Tax Foundation.

HOW THIS MEETUP WILL WORK:

• We'll start the meeting asking everyone in the room for their vote on whether they think capital gains should be taxed at the same rate as ordinary income -- Yes, No, or Abstain. You also get up to 30 seconds to give an explanation of your vote, or to say what kinds of details you want to hear more about at the debate.
• Then we'll have a speaker presenting arguments in favor of taxing capital gains at the same rate as ordinary income, followed by another speaker presenting arguments against. Each of these speakers is given 6 uninterrupted minutes.
• After that, everyone in the room will get to participate in a moderated floor debate. A moderator will make sure that people take turns speaking.
• At the end, the 2 original speakers will make closing statements of 3 minutes each, and then we'll take a final vote on the question. When you give your final vote, you'll also have up to a minute to say what arguments in this debate that you found particularly compelling, or what you've changed your mind about (if anything).

Our meeting will be conducted on Zoom. The Zoom link will be visible here on the event page before the event to those who RSVP. It's your choice if you want to turn on your camera or not, but people who can be seen are often more persuasive. At SFDebate, everyone gets a chance to speak and is encouraged to do so, but no one is required to speak if they don't want to.