Hillary’s Inconceivably Stupid Capital-Gains Tax Scheme
By Larry Kudlow | Friday, 24 Jul 2015 09:44 PM
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So if investment is the problem, what does Hillary Clinton go out and do? She proposes jacking up the tax on investment. It’s almost inconceivably stupid.
In her latest economic speech, Clinton proposes doubling the capital-gains tax rate on the profit made from asset sales (stocks, bonds, real estate) held a day less than one year up to two years. Right now, if you take a capital gain a day more than one year, you are taxed at a 20 percent rate. Actually, it’s 23.8 percent when you include the healthcare surtax. So under Clinton’s brilliant new play, you’d be taxed at 43.4 percent — the top individual cap-gains rate of 39.6 percent plus the 3.8 percent Obamacare surtax.
That means, instead of keeping 80 cents on the additional dollar of profit, you’d only keep 56.6 cents — a 30-percentage-point reduction in the take-home-pay reward for taking an extra dollar’s investment risk.
This will create a tall barrier to investment — what we don’t need. If you tax something more, you get less of it.
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I rant a lot about the corporate income tax. Only real people pay taxes. Corporations are merely fictions that hide the Gooferment’s taxes from sight.
When you try to figure out how much tax you really pay, look at a can on beans and try to guess what percentage of the price is really hidden taxes. Don’t forget all the incremental taxes along the way from the bean field to the store. Argh!
And, who owns all the capital invested in stocks and bonds — pension funds.
So, the political class is robbing the taxpayers blind.
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