President-elect Trump and the Republican Congress have ruled out any increase in capital gains tax, according to an economist.

• During her campaign, Kamala Harris suggested increasing long-term capital gains tax rates for high-income individuals.
• According to policy economists, President-elect Donald Trump and a Republican-controlled Congress will not implement an increase in capital gains tax.
• The Senate remained in Republican control on Tuesday, with a slim edge in the House of Representatives.

According to experts, top earners are less likely to face higher individual taxes, including levies on investments, under President-elect Donald Trump.

During her campaign, Kamala Harris suggested increasing long-term capital gains tax rates for individuals earning over $1 million annually, raising the top rate from 20% to 28%. These rates apply to assets held for more than one year.

President Joe Biden's 2025 fiscal year budget proposed 39.6% long-term capital gains taxes on top earners, but Harris' plan diverged from this.

Erica York, senior economist and research manager with the Tax Foundation's Center for Federal Tax Policy, stated that higher capital gains tax rates are "completely out of the question" under a Trump presidency and a Republican-controlled Congress.

On Tuesday, Republicans retained control of the Senate and may retain a slim majority in the House of Representatives, resulting in a "trifecta" in the White House and both chambers of Congress.

York stated that even with partial Republican control, it is likely that the capital gains tax policy will remain unchanged.

In 2024, capital gains tax rates for long-term investments are 0%, 15%, or 20%, based on taxable income. For assets held for less than a year, regular income taxes apply.

In 2025, the taxable income thresholds will rise, and you determine your taxable income by subtracting the greater of the standard or itemized deductions from your adjusted gross income.

Changes to 'net investment income tax'

Capital gains, interest, dividends, and rents are subject to the 3.8% net investment income tax (NIIT) for higher earners whose modified adjusted gross income surpasses specific thresholds.

The MAGI limits for NIIT are $200,000 for single filers and $250,000 for married couples filing together, and these limits do not account for inflation. In addition to NIIT, higher earners also pay up to 23.8% in long-term capital gains taxes.

Howard Gleckman, a senior fellow at the Urban-Brookings Tax Policy Center, stated that Republicans might attempt to eliminate the net investment income tax.

He stated that it could significantly increase the federal budget deficit.

The deficit topped $1.8 trillion in fiscal 2024.