Political News

Senate committee approves capital gains tax

Posted February 17, 2021 1:42 p.m. EST

— A capital gains tax on the sale of high-profit stocks and bonds has been approved by a Senate fiscal committee.

The Ways and Means Committee passed the measure Tuesday night over Republican objections. The measure approved was a different version than what the committee was presented during a public hearing last month. The bill now heads to the Rules Committee, the last stop before a potential vote by the full Senate.

The original measure would have imposed a 9% capital gains tax on earnings from the sale of stocks, bonds and other assets above $25,000 for individuals and $50,000 for those who file jointly. The new version lowers the tax rate to 7% and increases the threshold to individuals and couples who make in excess of $250,000 on sales of stocks and bonds.

Retirement accounts, all property and home sales, farms and forestry would be exempt from the tax.

The measure would take effect Jan. 1, 2022 and is expected to bring in about $550 million a year. The capital gains tax — which is certain to face a court challenge if passed — has stalled in the Democratic-controlled Legislature in previous years.

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