Trump contemplates scrapping the capital gains levy on residential property transactions
In a recent meeting at the White House, President Trump discussed the potential elimination of capital gains tax on home sales with Philippines President Ferdinand Marcos Jr. This idea has also been championed by Congresswoman Marjorie Taylor Greene, who introduced the No Tax on Home Sales Act in July 2025.
The Act, currently a legislative proposal, aims to eliminate the federal capital gains tax on the sale of a primary residence. The bill specifically targets primary home sales, not investment or second properties, with the main objective being to encourage homeowner mobility and increase housing inventory.
Many homeowners, particularly older ones, hold onto their homes for extended periods due to the significant capital gains tax that would be triggered by selling, accumulated equity being a key factor. This reduced availability of homes for sale restricts the supply and drives up prices. By removing the capital gains tax on primary home sales, proponents argue that homeowners would be more willing to sell, thereby unclogging the market, increasing supply, stabilising or reducing prices, and providing more choices for buyers, including younger families looking to buy.
President Trump has publicly supported this concept, suggesting that such a move could stimulate the housing market. He also noted that this proposal could be part of a broader strategy to stimulate the market, potentially combined with efforts to lower interest rates.
However, the implications of this proposal are not without challenges. While it could lead to increased housing supply, greater market fluidity, and potentially more affordable housing options for buyers due to increased inventory, it may disproportionately benefit wealthier homeowners with larger gains on sales. Additionally, it could reduce federal tax revenues, impacting government budgets. The broader economic impact also depends on complementary policies like interest rates and housing supply constraints unrelated to taxes.
Rep. Marjorie Taylor Greene's bill, if approved, would not only eliminate the federal capital gains tax on home sales but also propose an IRS exclusion of up to $250,000 ($500,000 for joint filers) in capital gains from home sales, a measure aimed at delivering tax relief to homeowners looking to downsize or relocate without being penalised for appreciation.
In summary, the No Tax on Home Sales Act proposes to eliminate capital gains taxes on primary home sales to increase housing market activity and supply, making it easier for homeowners to sell without tax penalties. The effort is backed by political figures including Congresswoman Greene and President Trump as part of a broader housing market stimulus strategy.
The No Tax on Home Sales Act, supported by President Trump and Congresswoman Marjorie Taylor Greene, aims to remove the federal capital gains tax on primary residence sales to increase market fluidity, stimulate the housing market, and potentially offer more affordable housing options for buyers. However, this proposal may disproportionately benefit wealthier homeowners and impact federal tax revenues, highlighting the need for comprehensive policy-and-legislation in the real-estate sector. To provide further tax relief, the bill also proposes an IRS exclusion for up to $250,000 ($500,000 for joint filers) in capital gains from home sales. This act is a significant investing opportunity in the business and general-news landscape.
