It levies a 7% tax on the sale or exchange of long-term capital assets such as stocks, bonds, business interests, or other investments and tangible assets. It only applies to gains in excess of $250,000.
The tax does not apply to the sale or exchange of real estate or to transactions through retirement savings accounts.
Under the law, the first $500 million of revenue collected goes into the education legacy trust account, a source of dollars for public schools, early childhood education and child care programs. Anything above that amount is deposited in the common school construction account which is part of the capital budget.
It is exactly what is needed on a federal level. Low-income and middle class taxpayers are paying a lion's share of federal revenue, compared to what the top 0.2% (even top 1%) pay. Warren Buffet was spot-on when he said he paid lower tax rates than his secretary.