Biden unveils $1.8 trillion proposal that covers education and aid to families, funded by tax hikes on the wealthy

The top tax rate on capital gains will be 39.6%

The $1.8 trillion plan covers education and childcare but for markets, the thing to take note of is how this will all be funded and that is via tax increases on the wealthy.

As per the statement from the White House:

The plan will also eliminate long-standing loopholes, including lower taxes on capital gains and dividends for the wealthy, that reward wealth over work...The President's plan restores the top tax bracket to what it was before the 2017 law, returning the rate to 39.6 percent, applying only to those within the top one percent...Households making over $1 million-the top 0.3 percent of all households-will pay the same 39.6 percent rate on all their income, equalizing the rate paid on investment returns and wages.

This mainly just reaffirms the story from last week here and it is something that Biden had already talked up during his campaigning when running for president.

Unfortunately, there isn't much details on how the tax will be applied so the debate on how this may impact the market and when is still very much up in the air.