Tag: Archive

September 5, 2007 05:28 PM | Permalink |

Press Release:
Hundreds of Organizations Urge Congress to Close Tax Loophole for Private Equity and Hedge Fund Managers

–For Immediate Release–
September 5, 2007, 10:30 a.m. EDT

Contact:          
Brian Gumm, OMB Watch, (202) 234-8494
Steve Wamhoff, Citizens for Tax Justice, (202) 299-1066

WASHINGTON, Sept. 5, 2007-More than 300 national, state and local nonprofit organizations signed a letter sent today to members of Congress urging them to eliminate a tax loophole that allows mega-rich private equity and hedge fund managers to pay federal taxes at a lower rate than middle-income people. Among the signatories are unions, faith-based organizations, advocates for children and families, social service nonprofits, and tax fairness advocates.

The loophole in question allows private equity fund managers, who can earn hundreds of millions of dollars a year in compensation, to pay federal taxes at a lower rate than middle-income individuals. Specifically, the loophole allows part of the fund managers’ compensation called “carried interest” to be taxed at the low 15 percent rate for capital gains. Taxpayers earning as much as private equity fund managers usually are taxed at the top ordinary income tax rate of 35 percent.

The letter is being delivered a day before the House Ways and Means Committee is scheduled to hold a hearing to examine the carried interest loophole, as well as other tax fairness issues. This fall, the Ways and Means Committee is expected to consider legislation introduced by Rep. Sander Levin (D-MI) that would eliminate this unfair loophole.

The Senate Finance Committee will also hold a hearing Sept. 6 on the carried interest loophole – its third this year.

A copy of the letter is available at https://ctj.sfo2.digitaloceanspaces.com/pdf/carriedinterestsignon080707.pdf.

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August 10, 2007 03:10 PM | Permalink |

Newly released information from the Internal Revenue Service shows that the special low tax rates on capital gains and dividends, enacted or expanded under President Bush, reduced income tax payments by $91.7 billion in 2005. Almost three quarters of those tax reductions went to the 0.6 percent of taxpayers reporting 2005 adjusted gross incomes in excess of $500,000.

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August 9, 2007 03:18 PM | Permalink |

After years of promoting or ignoring corporate loopholes and tax sheltering, President Bush announced yesterday that his administration has suddenly discovered that these corporate tax dodges are a drag on our economy. But while the President is right to call for closing corporate tax loopholes, he’s wrong to suggest using all the resulting additional revenues to pay for a cut in the corporate tax rate.

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August 8, 2007 02:20 PM | Permalink |

The farm bill passed by the U.S. House of Representatives on July 27 includes a provision proposed by Congressman Lloyd Doggett of Texas to close a tax loophole that currently allows foreign companies doing business in the U.S. to dodge taxes on their U.S. profits — which gives these foreign companies an advantage that American firms don’t have. Unfortunately, the chairmen of the relevant committees in the Senate have indicated to the press that they are unlikely to include this provision in their version of the farm bill. They should reconsider.

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July 19, 2007 03:12 PM | Permalink |

Congressman Sander Levin (D-Mich.) has introduced a bill (H.R. 2834) in the House of Representatives to eliminate a tax loophole that allows private equity fund managers to pay taxes on their compensation at a much lower rate than other working people have to pay.

Most of us who earn an income from work are subject to federal income taxes at progressive rates, starting at 10 percent and going up to 35 percent for the very wealthiest. Private equity fund managers are at the top of this wealthy group, but nevertheless pay only 15 percent — the special low capital gains tax rate — on almost all of their compensation. This form of wages, called “carried interest,” can run into the hundreds of millions or even in excess of a billion dollars a year for individual fund managers.

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May 3, 2007 03:14 PM | Permalink |

President George W. Bush and his wife Laura received a $31,037 income tax reduction for 2006 due to the President’s tax cut program. Vice-president Dick Cheney and his wife Lynne, whose income was much higher, saved $110,932.

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April 26, 2007 03:16 PM | Permalink |

Taxes continue to take up a relatively small part of American economic output, according to data compiled by Citizens for Tax Justice from the Organization for Economic Cooperation and Development, the U.S. Treasury and the U.S. Census. For example, in all but two OECD countries, taxes make up a larger percentage of gross domestic product (GDP) than in the United States.

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April 16, 2007 03:47 PM | Permalink |

Wal-Mart appears to be skipping out on its fair share of taxes that most Americans have to pay to help support state governments. New research conducted in part by a leading non-partisan, non-profit tax organization reveals that Wal-Mart avoided $2.3 billion in state income taxes, cutting its payment to state governments almost in half between 1999 and 2005:

• Over those seven years, Wal-Mart reported $77.4 billion in pretax U.S. profits to its shareholders. But it reported a total state income tax bill of only $2.4 billion, just 3.16% of those profits.
• Had Wal-Mart paid taxes at the statutory state corporate tax rates for the same period, it would have paid $4.7 billion in state income taxes.

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April 9, 2007 12:54 PM | Permalink |

Taxpayers Likely to Pay the AMT in Tax Year 2007 Under Current Law, By State

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April 2, 2007 02:09 PM | Permalink |

Republican critics of the budget resolutions recently passed in the U.S. Senate and House of Representatives have claimed that the congressional budget bills include tax increases. This is false. For better or worse, the resolutions do not raise taxes by a penny.

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