It's hard to tax them at effectively the same rate. One issue you have to consider is inflation. If you buy a house in 1980 for 100k and sell it for $314k in 2

It's hard to tax them at effectively the same rate. One issue you have to consider is inflation. If you buy a house in 1980 for 100k and sell it for $314k in 2020, you didn't really make any real income. You can adjust for inflation, so it shouldn't stop you from trying to make capital gains the same as ordinary income. But you do need to adjust. Also, some types of assets subject to capital gains are separately taxed. If you own corporate stock, that corp might be paying a lot of income tax. That reduces the value of the stock, which means you are indirectly being taxed. Sometimes that indirect tax is basically a drop in the bucket compared to capital gains (holding Amazon or Uber long term), but for some assets it could be quite significant. But one big reason is that the upper middle class are easier marks and hold much less power than the capital class.