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Thread: Capital gains income’s tax discount is unjustified

  1. #1
    Join Date
    Aug 2010

    Capital gains income’s tax discount is unjustified

    A significant and clear benefit to our economy MIGHT possibly justify additional federal intervention within our free enterprise system.

    This tax reduction is granted to incomes rather than to investments or savings. It does not clearly or directly induce investment or savings to be greater than otherwise.

    If the reduced tax rate was the determining factor as to where and how savings or investments were allocated, there’s no reason to suppose that tax treatment favoring capital gains induced superior economic decisions.

    The concept of the free enterprise market is investors’ choices dependent upon their determining the probability and rewards for success. What if tax treatment favoring capital gains actually affects savings and investments by affecting the value of probable rewards?

    If government’s tax policies are enticing more investment in some classification of enterprises, it’s logical to believe that less favored enterprises are less able to attract investment capital. If that’s the case, government would be replacing Adam Smith’s unseen clever hand with the government’s clumsy claw. That’s completely contrary to the concept of free enterprise and the wisdom of the market.

    When the determining factor that induced a sale is due to tax policy, the question of a sale’s benefit to our nation’s economy is questionable. If selling an enterprise in its entirety or as one or more segments are marginal decisions based upon tax considerations, the retaining, nurturing and re-investment into the enterprise may be of equal or greater benefit to our nation. Within such cases, a favorable tax treatment (at very least) denies us of federal revenue and is further likely to be of net detriment our nation’s economic best interests.

    In cases where the determining factor to sell was not due to a tax policy, the sale would have been transacted regardless (of that tax policy). Profits due to transfers of wealth in themselves are of no greater or less than any other income sources’ economic benefit to our nation; income is income.

    The tax reduction favoring capital gains profits is unjustified.

    Respectfully, Supposn

  2. #2
    Join Date
    Aug 2010

    Capital gains & income averaging.

    Capital gains & income averaging.

    Long term capital gains are not economically more or less beneficial than incomes derived from entrepreneurs’ steadily nurturing and reinvesting into their enterprises.

    I am not opposed to speculators but I’m opposed to using tax policy to favor any business model over others. Unlike the proponents of the long term capital gains tax loopholes, I prefer our government promote transparent open markets that we all may be able to trust.

    Refer to the topic: “Capital gains income’s tax discount is unjustified”,
    posted at 12:43AM, August 27, 2010,

    There was an “income averaging” provision within our income tax regulations that mitigated progressive tax rate’s excesses when applied to the filing’s year’s taxable income.
    This tax reduction rewarded but was not limited to wealthy investors or those that sold their homes. It benefitted lottery or quiz program winners, sport or entertainment figures, inventors or anyone else that hit ANY KIND of financial jackpot within the taxable year for which they were filing an income tax return.

    It compensated those who were lucky or daring or devoted years for study or practice of their chosen professions.
    It was of no particular benefit to those with comparatively level annual incomes; (such as a Buffett , Romney or your mailman).

    I advocate elimination of the long term capital gains loophole and restoring the income averaging,

    Respectfully, Supposn

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