Legislative Package Introduced to Counter China’s Economic Threats
Nebraska Senator Pete Ricketts has put forward a legislative package aimed at safeguarding the United States’ economic interests from communist China, according to reports from the Daily Call News Foundation.
This legislative effort encompasses four bills designed to counteract the Chinese Communist Party (CCP) and other adversaries threatening to disrupt the prosperity of the United States. Among the proposals are measures related to capital gains taxation in light of actions by American adversaries, the PRC Military and Human Rights Capital Market Sanctions Act, and restrictions on investments linked to China.
“Communist China poses the greatest risk to the American way of life,” Ricketts stated in a press release. He emphasized the threat to a rule-based system that has preserved peace and prosperity for decades. “The American market should be advantageous for Americans. We cannot support markets that benefit our enemies like Communist China.”
The first bill in the package addresses capital gains, stipulating that profit made from investments in companies from countries such as China, Russia, Belarus, Iran, and North Korea would be treated as standard income, thus negating tax benefits usually associated with capital gains. This means that estates will not be able to benefit from what is termed a “step-up basis” for assets from these nations, which could inadvertently give tax advantages to heirs.
The Securities and Exchange Commission (SEC) will be required to maintain a public registry of affected assets. Additionally, sellers of these securities must notify buyers that any gains will be considered regular income.
The PRC Military and Human Rights and Capital Market Sanctions Act mandates that the President establish a public list of licensed companies and their affiliates, particularly those involved in human rights violations, forced labor, or associated with the Chinese military. This regulation will prevent Americans from trading in derivatives linked to these entities, and they will have a six-month period to divest from such investments once the law takes effect.
In terms of funding, one bill would affect donations made to universities that exceed $1 billion, prohibiting contributions from investments in specified entities identified as national security threats by the U.S. government.
Moreover, if a fund invests in a listed company, a 50% goods tax will be imposed at the time of purchase, while a 100% excise tax on profits will apply a year after the company is listed. Interestingly, this aspect of the bill won’t be enacted until after December.
A recent survey indicated that Chinese spy operations have been secretively active in several American cities, including Omaha, since 2018, aiming to surveil and intimidate dissenters.
