U.S. Sen. Ted Cruz (R-TX) said last week that he will introduce a bill to end capital gains tax on inflation.
Cruz said the bill would encourage more investment into businesses and promote economic growth.
“If you invest a thousand dollars, and then ten years later you sell whatever you have invested in for two thousand dollars, right now, you are taxed on that full gain, ignoring inflation, and ignoring the fact that inflation has eaten away a big chunk of that gain,” Cruz said. “However, this bill would tax based on true economic gains, versus taxing inflation. It is a pro-growth and pro-investment policy decision. It encourages people to invest more capital into businesses, and when you’re investing more capital in businesses it means you’re hiring more people, it means you’re buying more equipment, it means you’re raising wages, and that you’re driving economic growth. That is yet another example of what we need to be delivering real results.”
Cruz cited the economic benefits of the 2017 Tax Cuts and Jobs Act but added more needs to be done.
“We’re seeing the economic benefits of this tax cut, even just a few months into it. Over four million Americans have already gotten pay raises or bonuses directly as a result of the tax cut,” Cruz said. “As I talk to small business owners in Texas, there is an optimism that is incredible. You are seeing small business owners who are investing capital, who are expanding operations and opening new facilities, who are hiring new employees, who are raising wages, and the tax cut is a big, big, big part of that.”