Business Advisory

US Presidential Candidates on Taxes

3 min read

30 September 2024

Take outs:

Kamala Harris proposes expanding the child tax credit significantly, with amounts reaching up to $6,000 for children under age one. In contrast, Donald Trump is considering increasing the child tax credit to a flat $5,000 but does not outline specific age-based tiers.
Both candidates propose exempting tip income from taxation. However, Trump goes further by also proposing exemptions for Social Security benefits and overtime pay, which Harris does not specifically address.
Trump aims to lower the corporate tax rate from 21% to either 20% or 15% for domestically-produced goods. Harris's business tax policies are still to be determined, leaving more uncertainty in her approach to corporate taxation.
Trump emphasizes a robust tariff policy, including a universal tariff on imports and a significant tariff specifically on Chinese imports. Harris does not mention tariffs in her current tax proposals, focusing instead on credits and deductions.

KAMALA HARRIS (D)

Kamala Harris has announced new tax and economic policies as part of her campaign platform, including exempting tip income from taxation; expanding the child tax credit, earned income tax credit, and premium tax credits; and implementing new tax incentives for housing. She may continue the same policies put forth in the FY 2025 budget of the Biden-Harris administration or may propose additional tax policy changes.

Business Taxes	To be determined.
Capital Gains and Dividend Taxes	To be determined.
Credits, Deductions, and Exemptions	Exempt tip income from taxation. Expand the child tax credit to $6,000 for children under age 1, $3,600 for children 2-5, and $3,000 for older children. Expand the earned income tax credit for filers who do not claim children. Expand premium tax credits. Expand housing tax credits, including the low-income housing tax credit, a credit for new homebuyers, and a credit for the construction of started homes. Claw back deductions for depreciation and interest for certain rental construction investment.
Estate and Wealth Taxes	To be determined
Excise Taxes	To be determined
Individual Income Taxes	Exempt tips from the income tax. Expand the child tax credit to $6,000 for children under age 1, $3,600 for children 2-5, and $3,000 for older children. Expand the earned income tax credit for filers who do not claim children. Expand premium tax credits. Read more Expand housing tax credits, including the low-income housing tax credit, a credit for new homebuyers, and a credit for the construction of started homes.
Payroll Taxes	To be determined
Tariffs and Trade	To be determined
Other	To be determined

DONALD TRUMP (R)

Donald Trump would impose a universal baseline tariff on all US imports, impose a 60 percent tariff on all US imports from China, make the individual and estate tax cuts of the TCJA permanent (potentially without reinstating the cap on itemized deductions for state and local taxes), lower the corporate income tax rate from 21 percent to 20 percent or 15 percent (potentially for domestic production only), tax large private university endowments, consider replacing the income tax with tariffs, exempt tip income from taxation, exempt Social Security benefits from taxation, and exempt overtime pay from taxation. Trump is considering expanding the child tax credit to a $5,000 universal credit.

Business Taxes	Lower the corporate income tax rate from 21 percent to 20 percent. Lower the corporate income tax rate to 15 percent for companies that make their products in the US.
Capital Gains and Dividend Taxes	No tax policies proposed
Credits, Deductions, and Exemptions	VP candidate JD Vance has discussed increasing the child tax credit to $5,000. Reinstate an unlimited itemized deduction for state and local taxes (SALT) paid or discontinue the cap as part of TCJA extension.
Estate and Wealth Taxes	Make the expiring estate tax cuts from the 2017 Tax Cuts and Jobs Act permanent.
Excise Taxes	Tax large private university endowments.
Individual Income Taxes	Make the expiring individual income tax cuts from the 2017 Tax Cuts and Jobs Act permanent. Consider replacing personal income taxes with increased tariffs. Reinstate an unlimited itemized deduction for state and local taxes (SALT) paid or discontinue the cap as part of TCJA extension. Exempt Social Security benefits from taxation. Exempt tip income from taxation. Exempt overtime pay from taxation.
Payroll Taxes	Exempt Social Security benefits from taxation. Exempt overtime pay from taxation.
Tariffs and Trade	Impose a universal baseline tariff on all US imports of 10 percent to 20 percent. Impose a 60 percent tariff on all US imports from China. Consider replacing personal income taxes with increased tariffs.
Other	No tax policies proposed