the economy

Democratic presidential candidate Kamala Harris on Friday outlined proposals to cut taxes for most Americans, ban “price gouging” at grocery stores and boost affordable housing as part of an “economy of opportunity” she plans to pursue if she wins the White House.

In her first major speech focused on the economy, the candidate promised to introduce a new child tax credit of up to $6,000 for families with newborns, cut taxes for households with children and reduce the cost of prescription drugs.

The US vice president also advocated for the construction of 3 million new homes in four years and a tax incentive for those who build houses for first-time buyers.

Harris told supporters at a rally in North Carolina (a state she hopes to win in the Nov. 5 election) that the U.S. economy is strong but prices are still too high, and that she will focus on the middle class.

Together, we will build what I call an opportunity economy (…) Building the middle class will be a defining goal of my presidency because I firmly believe that the country is strong when the middle class is strong,” said Harris.

His program could face resistance from both businesses and Congress, which has rejected similar proposals from US President Joe Biden.

Criticism of Trump

His goal is to contrast his opponent in the November 5 election, Republican Donald Trump, on tariffs and taxes.

Former President Trump proposed new widespread tariffs on imports, an idea Harris rejects.

“He wants to impose what is effectively a national sales tax on everyday and essential products that we import from other countries (…) That will devastate the American people,” Harris warned.

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The measure “will mean higher prices on almost all of your daily needs: A Trump tax on gasoline. A Trump tax on food. A Trump tax on clothing. A Trump tax on over-the-counter drugs,” he added.

Donald Trump’s economic plan would cost the average family $3,900 a year, he said.

“Comrade Harris is going all in on communism!” Trump responded on Friday, criticising in particular the idea of ​​price controls. The term has a strong pejorative connotation in the United States.

“There have been many attempts throughout history to limit prices, and they have failed because they have led to queues in front of shops, shortages and an explosion of inequality,” the 78-year-old Republican millionaire criticised.

Answer advisors

In a conference call with reporters on Friday, Trump economic advisers Kevin Hassett and Stephen Moore argued that Harris’ proposals would fuel inflation and hurt the economy.

A proposal to offer up to $25,000 to first-time homeowners would only push prices up, they said.

Republicans criticize Biden and Harris for presiding over an economy in which prices have risen and blame their policies for fueling inflation.

Harris’ plans aim to address that problem by appealing to a segment of workers who often view Republicans as better managers and are anxious about higher costs and their economic prospects.

They pay waiters less

Eliminating tip taxes; the discussion enters the campaign

Donald Trump and Kamala Harris have little in common, but they do agree on one thing: the two candidates for the White House want to eliminate tip taxes, a clearly electoral measure but one with major economic consequences.

Among the voters the two candidates hope to woo are those in Nevada, a key state for the November presidential election. The state home to Las Vegas has the largest number of waiters in the country relative to population, according to the Department of Labor.

The tipping culture in the United States is different from that in most countries. Customers are encouraged to leave generous tips for a coffee or takeout. In restaurants, paying 15 or 20 percent above the price in recognition of service is the norm.

It is even legal for employers in some states to pay their employees $2.13 an hour, well below the federal minimum wage of $7.25, provided that the tip makes up the difference.

But “there is no particular reason why, across the board, people who work in the service sector should pay less taxes than a laborer or a nurse,” said Marc Goldwein of the Committee for a Responsible Federal Budget.

“This creates a problem of equity: two people who do similar work and who the market estimates to be worth the same amount of money have different levels of taxation,” he explains. “And that doesn’t make any sense.”

There are about four million tipped workers in the United States, or about 2.5 percent of all employees, according to a recent estimate by Yale University’s Budget Lab, a figure that includes bartenders, waiters and hairdressers.

According to this study, these workers generally have a lower weekly salary than the average and around 37% of them did not pay federal taxes in 2022. (AFP)