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The capital gains tax

Republican presidential candidates are pushing for lowering the capital gains tax or even eliminating it completely. They argue that the tax on profits from selling stock hurts business investment.
A recent editorial in U-S-A Today points out a few facts we should consider. 76% of the capital gains taxpayers in 2009 were in households with more than $250,000 income. There are also exemptions to lessen the burden for investors and small business starters.
The Congressional Budget Office says eliminating the capital gains tax would mean forgoing $574 billion in revenue over the next five years. Ouch! The tax rate has dropped from nearly 40% in 1977 to 15% today for gains held for at least a year. That’s less than half the top rate for ordinary income. That’s why billionaire investor Warren Buffett questions why he pays taxes at a lower rate than his secretary.
It seems to me the question is: Will a lower capital gains tax create jobs … or simply concentrate more wealth in the hands of the few?
Our thought for today is from Rex Stout:
“Nothing is more admirable than the fortitude with which millionaires tolerate the disadvantages of their wealth.”

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Topics : Business_FinancePolitics
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People : Rex StoutWarren Buffett

09/21/2011 1:12AM
The capital gains tax
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