End The Carried-Interest Tax Break — $11 Billion
Former Republican presidential nominee Mitt Romney’s low tax rate was the result of his generous giving to religious and charitable groups and what may be the most offensive tax break in the entire code — the “carried-interest loophole.” This intentional quirk in the law that allows certain investors to have all their income taxed as if it were capital gains, saving them about 19.6 percent on income over $400,000, is so inexplicable that it’s likely one of the reasons Romney never released his tax returns.
And because of the clout these private equity and hedge fund Masters of the Universe have in Congress, this economically useless giveaway will likely never go away. But if it did, we could be almost halfway to the $25 billion we need to help the unemployed.
“The difference in revenue to the United States government when this combined income is taxed at 20 percent rather than at 39.6 percent is about $11 billion annually,” wrote Lynn Forester de Rothschild, who as the CEO of E. L. Rothschild is eligible for the loophole. “Indeed, the Real Estate Roundtable, a leading industry lobbying group, puts the estimate even higher, at $13 billion — $5 billion in real estate alone.”
Photo: Adam Glanzman via Flickr
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