Quote:
Originally Posted by 12clicks
The rich are NOT using a loophole to pay 20% on their investment earnings. EVERYONE is taxed the exact same rate on their investment earnings. Tax free bonds? also available to anyone who wants them. Pretending a tax rate is a loophole is not going to win the argument. carried interest is a loophole, the tax rate for investments is not.
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Carried interest is a share of the profits of an investment or investment fund that is paid to the investment manager in excess of the amount that the manager contributes to the partnership. In theory it is something 'available to everyone' because anyone can create their own hedge fund or investment bank. Saying that most people are not able to do that is exactly the same as saying poor people have no ability to invest for long term capital gains or lack the funds to make tax free bonds a viable option.
Your argument would be stronger if you thought carried interest was just fine. The fact that you understand in reality carried interest is a loophole, available only to some, leads to the parallel conclusion that long term capital gains and tax free bonds are actually investment instruments also not truly 'available' to a large segment of the working population.
Again, the root of the problem is that we are taxing income and not spending. Shifting to a tax on spending would make the tax system much more universal and would allow people to save more, earn more and only pay into the system when they choose to spend money on luxury items.