The capital-gains levy is an elective tax on owners of stock and other financial assets. Investors have the ability to control when they pay the tax by when they sell their assets. They can hold unrealized gains until the need is too great or when the tax rate is at an acceptable level. This is called the “lock-in effect” of high capital-gains tax rates. It reduces economic efficiency because at a higher tax rate capital hibernates in older companies with lower growth potential and isn’t available for new capital ventures with higher potential returns.
The higher capital-gains tax has the ability to make equity ownership less valuable due to lower after-tax returns, so there is less appreciation in stock values when the tax rate is higher.
None of this is being considered by the current administration, they are only looking at increasing the capital gains tax as a perceived measure of fairness.