Quote:
Originally Posted by penguinz
(Post 5159249)
The article says max of 20%. Which is it. If it is 29% where is your source?
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It's widely known that he wants to take the rate back to 29% (clinton era). Once he got the nomination he is trying to push this 20% rate - although all investment professionals know that he is going to push it to 29%. (see Wayne H. and every other person on Wall St.) Here is an article about it dated 9/19/07. Notice how this fits his election cycle and now the 20% number is being floated. 20% will never happen. He is going to 29% and beyond.
http://www.usnews.com/blogs/capital-...ent-taxes.html
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Blog Entry Comments (55) Obama Pushes for Higher Investment Taxes
September 19, 2007 03:02 PM ET | James Pethokoukis | Permanent Link | Print
As part of his "Tax Fairness for the Middle Class" plan, Barack Obama is in favor of nearly doubling the capital-gains tax rate from 15 percent to 28 percent. Leaving the fairness issue aside for a moment—as well as the impact of higher taxes on economic growth—the Obama plan could also be called a "Ways in Which Government Can Collect More Taxes to Pay for New Spending" plan, since Democratic candidates are all scrambling to figure out ways to plausibly pay for new healthcare, education, and infrastructure spending if elected.
But Dan Clifton over at Strategas Research thinks the Dems may be disappointed by the ROT—return on taxes—from higher cap-gains rates. After reviewing the connections between changing cap-gains rates and government revenue during the past five decades, he concludes that higher cap gains could well be a revenue loser for Uncle Sam.
We examined the impact of capital-gains tax rates on investors realizing their gains. As the tax rate increases, investors hold their gains to avoid paying the higher tax. Conversely, lowering the capital-gains tax rate spurs realizations. Interestingly, the 1986 Tax Reform Act increased the capital-gains tax rate from 20 to 28 percent, but investors were given roughly three months before the tax increase was enacted into law. In turn, investors rushed to realize their gains before the higher tax rate kicked in, and capital-gains realizations remained depressed for nearly a decade thereafter with the higher tax rate in place.... Therefore, proposals to raise tax revenue from capital-gains tax increases will be scored as a net revenue gain to pay for new spending, but in reality, the tax revenue may not materialize, which will force tax increases elsewhere to pay for spending.
