Since this is "going forward only", how is this going to be administered to ensure existing investments are not affected?  Say you have 100K in an equity portfolio, and add $25k of retained earnings to it next year, any future capital gains are now based on $125k.  Over time, assuming 6% average annual growth, how will you account for what was grandfathered in and what was added under the new rules?  What if you have dozens of stocks?  What if you sell one equity holding containing a mix of grandfathered money and tax grab money, then buy another holding.  Does that one now get treated under the new rules?  This all sounds like a nightmare to me, and I guess the burden of keeping track will get passed to the business owners.