Vice President Kamala Harris’ tax proposal would cost the US nearly 800,000 jobs, roughly twice as many as former President Donald Trump’s plan, according to a recent analysis.
The nonpartisan Tax Foundation think tank estimated that Harris’ proposals would shrink the American long-run GDP by 2% and reduce wages by 1.2%, while lowering employment by roughly 786,000 jobs.
The Harris economic agenda includes a corporate tax rate hike coupled with up to $50,000 in handouts for small-business startups, $25,000 for first-time homeowners and $6,000 in expanded child tax credits.
The Tax Foundation estimates that would increase taxes by $4.1 trillion over the next decade — but raise only $642 billion in net revenue.
“We find the tax policies would raise top tax rates on corporate and individual income to among the highest in the developed world, slowing economic growth and reducing competitiveness,” the group wrote in its analysis.
“The tax credits and other carveouts would complicate the tax code, run more spending through the IRS, and, together with various price controls, fail to improve affordability challenges in housing and other sectors.”
At least 177,000 jobs would be lost under a Harris administration just by raising the net investment income tax rate from 3.8% to 5% and shifting the Medicare tax rate up to the same percentage.
Another 131,000 jobs would vanish under the expansion of the earned income tax credit, a provision in the 2021 American Rescue Plan — for which Harris cast the tie-breaking vote — as well as her campaign pledge to give $6,000 in tax credits to families of newborns.
Harris’ plan to hike the corporate tax rate to 28% would cost 125,000 jobs, and the additional tax rise on individuals with incomes over $400,000 would cause 86,000 more jobs to be lost.
Taxing unrealized capital gains of $5 million for individuals and $10 million for joint filers after death would cost 75,000 jobs.
The only economic proposal that would increase employment, according to the analysis, was the pledge to no longer federally tax tip income for service workers — an idea first proposed by Trump on the campaign trail in Nevada.
One of a few similar proposals by the 2024 candidates, it is predicted to add around 21,000 jobs.
Trump’s economic agenda, which is harder to gauge given the former president’s reversal on some policies, is projected by the Tax Foundation to increase wages by 0.6%, reduce long-run GDP by 0.2%, and lose about 387,000 jobs.
Much of the analysis focuses on the cost of a 10% universal tariff and a whopping 60% tariff on China, which would hemorrhage 674,000 jobs.
Trump has also floated an even higher 20% universal tariff, which would cost potentially another 402,000 jobs.
If Trump only opts to renew the 2017 Tax Cuts and Jobs Act, however, the result would be net growth of 907,000 jobs.
“Under the full suite of tariffs and IRA repeal, we estimate the deficit would rise by $1.3 trillion over the next decade on a conventional basis,” the analysis states. “After accounting for economic impacts, we estimate the deficit would rise by $1.2 trillion over the next decade.”
Neither the Harris campaign nor the Trump campaign immediately responded to a request for comment.
