Lion of the Blogosphere

Even hedge fund managers will get a tax cut under Trump plan

The New York Times “Upshot” points out that even hedge fund managers will pay less tax under the Trump plan. They currently are paying a 23.4% capital gains rate. Trump would eliminate the loophole that allows them to classify their income as capital gains, but he’s lowering the top rate from 39% to 25%, so there’s only a small increase on their income previously classified as capital gains, but a big decrease in the portion of their income previously classified as ordinary income.

The Times column also points out that there’s no way that eliminating deductions and loopholes could possibly make up for the huge lowering of tax rates in the Trump plan. Did Trump actually hire any tax law experts? The New York Times was quickly able to tear his plan apart.

This is so disappointing, Trump is just is another Republican bozo with a stupid tax plan.

Written by Lion of the Blogosphere

September 29, 2015 at 8:50 AM

Posted in Politics, Taxes

72 Responses

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  1. You said: Trump is not just is another Republican bozo with a stupid tax plan

    I think you meant: Trump is now just another Republican bozo with a stupid tax plan


    September 29, 2015 at 9:15 AM

    • So glad I have free editors, thanks.

      Lion of the Blogosphere

      September 29, 2015 at 9:23 AM

    • Everything about Trump from the beginning has always been in the bozo category. He speaks in bold generalities about things like “I will make it happen, and it really won’t be very hard either.” “I will have the best people working for me that you have ever seen.” “They will be really really great, just great.” “I will be the best jobs President God ever created.” “I will make China stop ripping us off. I know how to deal with them. I have been dealing with them for years. A lot of them rent space in my buildings and they just love me.” etc, etc, etc. He talks big. He talks bold. He makes huge promises. He also talks about things that are completely irrelevant like Chinese business people renting space in his building and “loving” him. That doesn’t translate one bit into they will bow down and do what he wants even if it costs them money. He is using “The Art of the Deal” tactics on the American people and they are buying it hook, line, and sinker. But he can’t back up even a single one of those promises or statements with any policy that shows how it could happen. I don’t know if he is partly delusional due to his huge ego or simply a pure con man regarding what he is promising, however his motivation is not really relevant. He has no ability to do anything he says he can do. Republicans don’t like hearing the truth that they can’t have everything they want, they can’t even have most of what they want. So Trump lies to them and they love it. The longer this goes on and a few very terse details like his tax plan get put on the table, the more people are likely to start stumbling out of their Teen Crush Fan phase and realize that just maybe the guy is an empty suit. Very appealing, everything they have been waiting for 2 decades for to finally come along, but nothing more than someone who is great at reading people and whispering sweet lies in their ears that they really can eat all the cake and chocolate they want and keep their girlish figure. And then the alarm clock goes off and is 6:15AM. Time to take the reality pill and go back to the grind.


      September 29, 2015 at 10:46 AM

      • The alternative is worse.


        September 29, 2015 at 12:55 PM

      • How so?

        Because a non-liar might make a deal with the Democrats and do something that you think is worse than doing nothing? That I suppose is possible. But the people getting behind Trump aren’t doing so because they think he will just hold fast against the Democrats. Most of them believe he will make all these things happen.

        Furthermore while the alternative you have in mind might be someone like Bush, the other possible alternatives include Hillary, Biden, or even Sanders. If Trump were to get the nomination it is likely that many independents will be far less impressed with his Empty suit than far right conservatives are. That will increase the likelihood that We get Obama’s third term.

        That will truly be worse than any of the GOP alternatives to Trump.


        September 29, 2015 at 3:02 PM

      • The only issue that matters this election is stopping immigration. And the only candidate who has even said he will is Trump. Nothing else matters. Anyythng else can be dealt with later.


        September 29, 2015 at 5:33 PM

      • Apex – You should know by now, that the West is in suicide mode, and it includes our unpleasant women (not commenting further, we have Firepower for that).


        September 30, 2015 at 3:53 PM

  2. There really isn’t much information on the plan available on his site. I’m really surprised that people are able to get into deep analysis of it.

    As for being “revenue neutral” my guess is that it is a tax cut for just about everyone, but that the one-time tax on money stored overseas is supposed to make up for that. When government people talk about tax plans usually they talk about the next ten years. Take that 10% of 2.5 trillion and divide it up over 10 years and you get 25 billion per year. If his plan cuts about that much per year he can call it revenue neutral according to the standard convention.


    September 29, 2015 at 9:16 AM

    • The one-time $250 billion tax collected from the repatriation would probably cover only the first year of massive tax cuts.

      Lion of the Blogosphere

      September 29, 2015 at 9:24 AM

  3. The death tax is a stupid tax. Good for Trump.

    Andrew E.

    September 29, 2015 at 9:26 AM

    • Why is it “stupid”?

      Lion of the Blogosphere

      September 29, 2015 at 9:41 AM

      • Federal income taxes, state income taxes, local income taxes, sales taxes, tariffs/import/export taxes, payroll taxes, medicare taxes, gas taxes, inflation tax, taxing via regulations, taxes on interest income, capital gains taxes, property taxes. With Leftists, it’s never enough.

        There is no need for ghouls to reach into the grave to take one last cut.

        Andrew E.

        September 29, 2015 at 12:27 PM

      • They are not reaching into the grave, they are taxing the lucky windfall profit of the rich person’s heirs.

        Lion of the Blogosphere

        September 29, 2015 at 1:46 PM

      • Because it legitimizes the idea that all the money is really the government’s and its the government’s prerogative what you are allowed to keep.

        If the government’s interests are best served by giving your money to someone else, then they are allowed to do so.

        cluster of grapes

        September 29, 2015 at 1:06 PM

      • tomato, tomahto. It’s a stupid tax.

        Andrew E.

        September 29, 2015 at 1:54 PM

      • They are not reaching into the grave, they are taxing the lucky windfall profit of the rich person’s heirs.

        It is not a lucky windfall. The dead person positively intended to give the money to his heirs. Whether or not the heirs “deserve” the money is for the rich person to judge, not the government. The government (and everyone the government claims to serve) has ZERO claim on that money.


        September 29, 2015 at 2:22 PM

      • “Because it legitimizes the idea that all the money is really the government’s and its the government’s prerogative what you are allowed to keep. ”

        Large fortunes the like of which go beyond the estate tax exemption are a result of government protections such as limited liability for businesses. Large hereditary fortunes propagate unearned power and influence. It is perfectly just for the government to work against the stability of large hereditary fortunes.


        September 29, 2015 at 8:09 PM

      • “Large fortunes the like of which go beyond the estate tax exemption are a result of government protections”

        Large fortunes like a family farm or a chain of 3 Subways.

        This idea of hereditary fortunes is vastly over blown.

        cluster of grapes

        September 30, 2015 at 8:09 AM

    • Death taxes, tariffs, and excise taxes are the best taxes. They would all be worthwhile even if the money collected weren’t put to any use.

      Lloyd Llewellyn

      September 29, 2015 at 12:14 PM

      • Only in moderation. Otherwise, it becomes worth it to cheat and smuggle. Economists have long known exactly how much to tax smokes before people start smuggling and selling them on the black market.


        September 29, 2015 at 1:13 PM

    • “They are not reaching into the grave, they are taxing the lucky windfall profit of the rich person’s heirs.”

      Your superior intelligence, Lion, is a kind of “windfall profit”–a lucky stroke you did nothing to deserve– as the “heir” of your parents genes.

      Based on that unearned good fortune of yours, how much of your hard-earned money do you calculate the government may rightly take from you?

      Jonathan Silber

      September 29, 2015 at 7:36 PM

      • I don’t have a job so right now they aren’t taking anything at all.

        Lion of the Blogosphere

        September 29, 2015 at 7:42 PM

      • Natural inequalities such as intelligence are not the same as unnatural inequalities such as unearned money. In fact, large hereditary fortunes work negatively against society receiving the benefit of natural inequalities by decreasing social mobility and making it more difficult for the intelligent and talented but unconnected and unprivileged to get ahead relative to less talented inheritors.


        September 29, 2015 at 8:11 PM

  4. I skimmed through the comments on the earlier post. I will comment here since its a later but still related post.

    1. I agree “there is not much to see here” on the Trump tax plan. Its something he pretty much has to do because he is running as a Republican. Its not a reason to vote for him, or really a reason not to vote for him.

    2. Tariffs bring in revenue too. If Trump really favors tariffs, then he doesn’t have to bring in as much through internal revenue measures (meaning taxes).

    3. The key to tax reform is how personal income is defined and subject to tax. The government can tax wages really easily, but struggles with other types of income. In principle, the more income that is visible and taxable, the more rates could be lowered on all income and bring in the same amount of revenue, and the less need to treat different forms of income differently. Tax reform should be about treating one source of income no differently than the other for tax purposes.

    4. In view of # 3., there is no way to avoid having the biggest administrative headaches fall on self-proprietors (small businesspeople and freelances) other than just removing them from the tax rolls altogether. You might get away with having a really big personal deduction, if you make enough income subject to tax, which would help in this respect.

    5. Also in view of # 3, treating sources of income the same across the board would eventually mean no estate tax and a really different capital gains tax. Income is income. But I don’t think absent the sort of comprehensive reform I’m talking about, these taxes have a place.

    6. All corporate income eventually turns into personal income, so a corporate tax is not needed. But keep in mind that “corporations” are really government chartered organizations that are supposed to serve some public purpose.

    7. There should be one or more taxes other than the personal income tax, to capture income that the even the best designed income tax won’t capture, and to make sure that everyone “has skin in the game”. Sales taxes work well for this purpose, but relying on them to be the primary source of federal revenue is much too regressive, plus there is a federalism problem since they are the primary source of state revenue. I never understood the reasoning behind property taxes.

    8. An amendment requiring a balanced budget is a bad idea for all sorts of reasons, don’t take seriously anyone who proposes it. But a cap on the percentage of GDP the federal government takes in as revenue is workable and fulfills pretty much the same objectives as a balanced budget amendment. You never hear this being proposed. The cap could be lifted if Congress declares war, which would also restore Congress’ war-making power.


    September 29, 2015 at 10:18 AM

    • “All corporate income eventually turns into personal income, so a corporate tax is not needed.”

      1. Only if the shares are sold and they become capital gains taxes. Or if the corporation pays dividends.

      2. The shareholder may be in a foreign country and thus pay taxes to a foreign country instead of to the United States.

      3. Infinite deferral of taxes is almost as good (for the taxpayer) as having a zero tax rate.

      Thus corporate taxes are definitely needed.

      Lion of the Blogosphere

      September 29, 2015 at 11:10 AM

      • I believe the rules for the different business entities were written up with pros and cons, to make them equitable, relatively comparing with each other, and to foster rational decision making and functional capitalism. By getting rid of the double taxation of the corporate structure means “all hell breaks lose, now I can doing anything I want with my profits, and eliminate my competitors unfairly”. Unlike C-Corps, S-Corps and LLCs aren’t subject to double taxation, only pass through income to the shareholders and owners, and they will be unfairly targeted and outcompeted, if big corporate companies are not subjected to the double taxation. This being said, even with our current rules in motion, big corporations often don’t pay any taxes to begin with, because they exploit the loopholes already in place for them.


        September 29, 2015 at 11:25 AM

      • Would you believe me if I told you Big Business will use all of their tax savings to give their employees extra bonuses?

        The Undiscovered Jew

        September 29, 2015 at 7:59 PM

      • Thanks for the laugh.

        Lion of the Blogosphere

        September 29, 2015 at 8:43 PM

      • Thanks for the laugh.

        You won’t find it funny if you become a senior executive and find Trump’s tax cuts for the rich tucked away in your own compensation, while those beneath you get nothing.

        The Undiscovered Jew

        September 30, 2015 at 8:33 PM

  5. Again, when it comes to the very wealthy & corporations… Tax rates are far less important than the definitions of taxable income.

    By eliminating tax exceptions that cause nearly all of hedge fund income to be untaxed, tax rates go up.

    This is the “Ronald Reagan raised taxes” argument all over again. Reagan’s 1986 plan lowered rates and eliminated untaxed income. Was that a tax increase? Your rate was lower but your bill was higher.


    September 29, 2015 at 10:58 AM

  6. Yeah…that goes beyond being a stupid tax plan. There’s something deeply sneaky about how it’s being presented, unless his plan is to sucker punch the hedgies in a bit. But that’s probably not going to happen. And it’s that sneakiness that is going to get up the noses of his potential voters.


    September 29, 2015 at 11:00 AM

  7. Leon would never be happy with a candidate who didn’t promise to screw the other guy and pass the savings on to him. LOL


    September 29, 2015 at 11:00 AM

  8. I predicted that Trump’s tax plan would be stupider than every single Democratic candidate’s. I’m too lazy to read Trump’s proposal, let alone that of every democratic contender, but I’m going to assume that I was right.

    Lloyd Llewellyn

    September 29, 2015 at 11:01 AM

  9. I generally like the philosophy and structure behind Trump’s tax plan. And I figure you do too — or would if you weren’t caught up in the numbers and wanting rich people to get screwed. If the rates for high earners were higher would you be happy? Of course you would. That’s why you shouldn’t take the the rates at face value. They’re more like an opening bid or offer. You always ask for more than you want or willing to accept then negotiate some of it away. If his tax plan ever sees the light of day we’ll end up with a more simplified tax code with similar rates as now. We’ll also see a slightly higher exemption for estate taxes which is fine. He’s just giving Dems some low hanging fruit so that when the negotiations are over they can go back and tell their constituents how much they “won”.


    September 29, 2015 at 11:35 AM

  10. Magical thinking – told you. “Everything will be fine if we leave everything the way it is!” Right.

    Viscount Douchenozzlé

    September 29, 2015 at 12:18 PM

    • As opposed to Hope and Change?


      September 29, 2015 at 7:32 PM

  11. All of Trump’s policy papers are very obviously ghostwritten and I’d be honestly surprised if he’s read any of them in full. When you see him do interviews, one re-occurring theme is that he doesn’t like hard work or coming up with plans. Every problem will either be solved through the sheer force of his own personality (“I’ll get them to do X”) or by delegating responsibility to “the best people.”

    Trump may have esoteric or unconventional ideas deep down, but he’s clearly too lazy to flesh them out into actual policies. So he farms out the chore to whatever stereotypical rich-guy Republicans inhabit his inner circle.

    This is the central absurdity of the idea of having a billionaire as a populist presidential candidate. When you look at the great populist candidates of US history they’ve all been preachers or farmers or bumpkin lawyers — the sort of people far enough from the elite to actually think independently. Trump’s giant ego makes him a little unorthodox, but as a celebrity who came to politics so late in life he’s a slave to the conventional wisdom of his class.


    September 29, 2015 at 1:32 PM

    • I guess that’s why we don’t see a lot of proposals from low-energy ¡Jeb!. He hasn’t gotten around to writing them yet. But once he gets sworn in, he surely will.


      September 29, 2015 at 2:35 PM

      • On the other hand, Obama will always be remembered for single-handedly writing his ACA. Truly a Harvard-level effort.


        September 29, 2015 at 2:36 PM

    • None of these 1 page declarations can be described as “policy papers”. They’re rough outlines.


      September 29, 2015 at 2:43 PM

    • When you look at the great populist candidates of US history they’ve all been preachers or farmers or bumpkin lawyers…

      Pretty much all losers, right?

      “Great populists” rarely get past the “candidate” stage.

      Trump is flawed, his proposals are flawed but is he better than Hillary, Sanders, Biden, Bush, Rubio, Cruz, Carson, Fiorina?

      I say YES, flaws and all.


      September 29, 2015 at 8:06 PM

      • Bernie Sanders has a good tax plan.

        Lion of the Blogosphere

        September 29, 2015 at 8:44 PM

      • You can have a true populist or you can have an electable candidate. You can’t have both, though in the long term an effective populist can expand the whatchamacallit, Overton Window of acceptable policy ideas or whatever. I’m not terribly convinced Trump has even done that.


        October 1, 2015 at 4:27 PM

  12. It’s looking like he’s not the conservative populist that Lion and I wanted.


    September 29, 2015 at 3:23 PM

    • Time to get on the Sanders train, comrades.


      September 29, 2015 at 8:16 PM

    • Sanders has walked back significantly from those comments

      Of course. He just said it to trigger liberals with the term “Koch brothers”!!!

      He wants as many non-White and democrat voters in the US as possible.

      Maybe not in his “backyard” of Vermont, LOL, but nationwide.


      September 30, 2015 at 1:16 PM

  13. The way that the NYT comes up with the 23.8% tax rate is to include the Net Investment Income Tax which is 3.8%. The current long term capital gains tax rate is 0% if you are in the 15% tax bracket (< $36,900 single, < $73,800 married), 15% if you are in the 25-35% brackets (<$406,750 single, $200,000 single or >$250,000 married.

    Since hedge fund managers are probably in the 39.6% bracket they are indeed paying 23.8% on their carried interest income. However, I don’t see any mention of the Net Investment Income Tax in the Trump tax plan. I guess the assumption is he is doing away with it as part of the simplification. Maybe the NYT has more details about the plan than is on the web.


    September 29, 2015 at 3:51 PM

    • This post got somewhat screwed up by using less than and greater than signs, that apparently got taken for HTML.

      The capital gains rate is 15% for the 25-35% rate bracket which is less than $406,750 single, or $457,600 married. The capital gains tax rate is 20% for the 39.6% bracket.

      The Net Investment Income Tax (3.8%) applies to capital gains income if you income is greater than $200,000 single or $250,000 married.


      September 29, 2015 at 6:19 PM

  14. Off topic; related to the blog theme of mainstream media as a form of SWPL status signaling. A friend tweeted this NYMag Jonathan Chait article and I needed to vent about it somewhere because I have a strict policy of not arguing about politics on social media.

    The point of the article Is that US conservatives are backward and ignorant for opposing some climate change policies, while conservatives elsewhere around the world are not. The article summarizes a study by some professor in Bergen, Norway which discuss the climate policies of parties in nine countries, all of which are located in the Anglosphere or Western Europe. The article doesn’t say anything about what politicians in Iran, Russia, Saudi Arabia, Venezuela, Indonesia, or hundreds of other countries elsewhere think about climate change.

    Furthermore, the photo of Obama and Xi Jinpiang above the article is really misleading because China is NOT one of the nine countries mentioned in the study, China does not even have political parties, although it would be interesting to know what Chinese politicians think about climate change because China is the world leader in carbon emissions.

    Ava Lon

    September 29, 2015 at 5:17 PM

  15. If Trump builds a wall he will be the single greatest president of all time.

    And there should be no death tax. A dead man worked for his family and it should go to them. The money was all ready taxed.


    September 29, 2015 at 6:09 PM

  16. I don’t see what the complaint is here. He got rid of the carried interest benefit as promised and he has crafted a tax plan with enormous benefits for the middle class. Which is what counts, not whether rich people pay more. The interesting part of the plan is treating hedge-fund income as ordinary income, which is why it is subject to the same 25% rate.

    In other words, Trump, unlike other Republicans, knows who his constituency is and he has crafted a tax plan that benefits them. There are a lot of middle class and working class white people who will benefit. Trump’s plan is also a huge departure from the typical Republican nonsense about job creators coupled with getting rid of the home mortgage deduction. Imagine, the Republicans would throw huge numbers of middle class white people under the bus with their typical proposal.

    Now if Trump would tax nonprofits and impose tariffs, then he would have an even stronger hand.

    We also need to stop worrying about budget deficits. This is not a problem in any foreseeable future

    One final note: I’ve been making habit of looking at the backgrounds of New York Times authors, in this case, Josh Barro, who penned the critique of Trump.

    What, if anything, in this kid’s background makes him an expert in the subject matter about which he writes? He has a BA in psychology from Harvard. Yet, that somehow prepared him for a real estate banking career at Wells Fargo and economic policy writing at the Manhattan Institute.

    I wonder if he is a son of Robert Barro, the economist?


    September 29, 2015 at 6:27 PM

    • Why are budget deficits not a problem?

      Copperhead Joe

      September 30, 2015 at 1:38 AM

      • Worrying about budget deficits assumes that the United States is subject to corporate accounting.

        It is not.

        Treating the US as analogous to a corporation is due to a wrong-headed belief that the US competes in the global economy regulated by market principles. This is not the case. The global economy is the US economy extended globally, where foreign countries use mercantilist economic principles and where the US market is the export market of last resort.

        In other words, the trade surpluses that Germany, Japan and China generate depend heavily on the US government willing to run trade deficits against the world. These nations depend on the US trade deficit policy to move their output because they would never be able to dump their US-earmarked output into any other country.

        This is the fatal flaw of the “export-led” growth strategy that increasing numbers of nations adopted after WWII. Each nation that adopts it reduces the number of nations willing to take in imports, resulting in the US becoming the big winner in this regard.

        Think of a trade deficit for what it really is: Tribute provided to an Empire. In this environment, budget deficits really don’t matter.


        September 30, 2015 at 12:52 PM

  17. I would bet that supporters of Trump couldn’t care less about his plan for tax reform: they support Trump because he promises to build an effective fence on our border with Mexico, to stop the flow of illegal immigrants, and to deport those already here.

    If he delivers only on that promise and on nothing else, I’ll regard him as the savior of our country; and he can spend the rest of his term in office, for all I care, hawking his shirt & tie sets from the Rose Garden.


    September 29, 2015 at 7:16 PM

  18. Trump wants to build up the military, which is a good idea, but where will the money come from?


    September 29, 2015 at 8:29 PM

    • Welfare programs cost taxpayers $900 Billion per year. Deporting millions of illegals will not only save the money spent on them but free up jobs for millions of Americans to get off welfare and back to work. The welfare reform programs of the late 90’s got nearly half those on welfare back to work before they were undone. That’s $500 Billion right there.


      September 30, 2015 at 1:32 AM

  19. See, I told all you Trump supporters he wasn’t going to make it. Now that’s he’s gone tax cut city, he’s cruising to boring land. That fluff about he’s just like Reagan is sweet it really is. Reagan was a sincere old man who made people feel good, but his tax cuts created zero jobs. Retail and fast food aren’t going to improve your life or pay off your student loans. Now the air is coming out of Trumpmania.
    How exactly is he creating jobs by cutting taxes for the Rich? These are the guys firing Americans to hire foreigners. It just means more jobs for foreigners to increase the invasion to turn America into Crappastan.
    Do you believe he will follow through on expelling foreigners if he’s giving money to the Rich who are baiting these invaders?
    Its really amazing how trusting people who have been screwed over and over again by false promises that make the Rich richer by turning your neighborhood into Grand Theft Auto: Vice City are still willing to let the Rich eat your lunch and give the scraps to the invaders.

    Joshua Sinistar

    September 29, 2015 at 8:32 PM

    • America into Crappastan

      America = Meriprolestan


      September 29, 2015 at 9:10 PM

  20. Karl Denninger is smarter than anyone here and anyone at the NY Times. He weighs in on the plan:

    Andrew E.

    September 29, 2015 at 9:35 PM

    • Denninger is a fool.


      September 30, 2015 at 12:54 PM

      • Don’t hear anyone else talking about the medical monopolies that need to be broken up.

        Andrew E.

        September 30, 2015 at 1:42 PM

  21. I’m disappointed at this post Lion.

    1. The author Joshua Barro is a psychologist whose daddy (Robert Barro a well known academic macroeconomist) got him “banking” jobs. The guy is not a CPA nor a tax lawyer and the article is full of baselesss assumptions,innuendo and distortions such as: “In other words, Mr. Trump’s worldwide tax plan would have no effect on Ford’s choice to make cars in Mexico,” 35% tariffs on Ford’s mexican products (which Trump has talked about dozens of times) would have a major impact, and be a major source of revenue for the federal government yet “Josh” willfully ignores that (before the XXth century tariffs were by far the main source of revenue for the federal government)

    2. It’s difficult for a company to justify paying a 39% corporate rate for domestic firms in the US when across the border Canada offers a 15% federal corporate tax. Trump knows that, part of the reason Burger King bought Tim Horton’s was to relocate the company to Canada and pay a much lower tax bill. No other candidate even knows what a corporate inversion is.

    3. Joshua seems very concerned about a “low” 15% corporate rate, yet GE for instance has had an effective federal income tax rate of around 2% for the past decade. Multinationals indefinite deferral of taxation for overseas earnings is a big part of that and something say, CVS, can’t do.

    4. A few people here mentioned Bernard Sanders, well he doesn’t even have a real taxation platform, all he has are vacuous slogans and vagaries such as:

    – “He will also enact a tax on Wall Street speculators who caused millions of Americans to lose their jobs, homes, and life savings.” So, Silicon Valley speculators will be exempted? 😀

    – “Introduced the gold standard for climate change legislation with Sen. Barbara Boxer to tax carbon and methane emissions.” Enjoyable taxes on electricity, gasoline and more.

    ( I’m not even going to mention that idiot’s other disastrous ideas such as giving amnesty to the 20+ million illegals, and expanded legal status for their parents, siblings, kids, etc…)

    5. This is just a plan, and even if you disagree with parts of it:

    – It’s much more grounded than some ridiculous “flat tax” structure.
    – It does mention the need to eliminate the favorable treatment of carried interest in LLC’s
    – it does mention specifically limits on the deductibility of interest expense, which is important and would lower companies’ debt load in the long run.

    Sure, the plan isn’t perfect, eliminating the estate tax would allow idiotic heirs to get more money, but nothing ever is perfect in politics.

    Daniel González Buitrago

    September 30, 2015 at 2:47 AM

    • I’m not really certain how this corporate inversion thing works to Burger King’s benefit. Their stores are still located in the US. How does the inversion escape the 39% tax rate?

      I can see how GE does this.

      Little note: GE has a billion-dollar budget allocated for its legal department.


      September 30, 2015 at 1:04 PM

      • Burger King corporation is almost exclusively a franchisor, they only own about 1% of the restaurants operating under their name. Before the purchase of Tim Horton and the corporate inversion, Burger King corporation in Delaware was paid by their franchisees (regional, per country, per city) a certain sum periodically, and then like every US based corporation it had to file US federal taxes. Given that the maximum marginal tax rate in the US is 39% vs 15% in Canada those guys created a new legal entity in Ontario which absorbed both Tim Hortons and Burger King Corporation, so afterwards all franchisee payments will be sent to Canada and that entity will file Canadian federal taxes at a maximum rate of 15%. The tax savings are large. Many US companies are doing this, just like plenty of companies operating in Europe set residence in Ireland (12% corporate rate)

        GE’s case is different because they have legally separate wholly owned subsidiaries in every country in which they operate.

        Daniel Gonzalez Buitrago

        October 3, 2015 at 2:47 AM

  22. The Teamsters union has decided to withhold an endorsement of Democratic presidential frontrunner Hillary Clinton, Fox News reports.

    Also, the union wants to wait and see whether Vice President Joe Biden enters the race, and they want to talk to Republican candidates as well, especially frontrunner Donald Trump, who has worked with unionized workers throughout his career, Rosen said.

    Heh heh heh. Sorry Hillary, nothing personal, they just want to date other people.


    September 30, 2015 at 3:14 PM

    • NYT does a Trump profile:

      Anyway, the most interesting part was how journalists react to Trump. For instance:

      I positioned myself in the post-­debate ‘‘spin room,’’ the area where campaign surrogates spew their customized nonsense to media types. The candidates themselves almost never venture in. But suddenly, at the end of the night, a literal stampede was rumbling toward a far corner of the room, where Trump had crashed this assembly of polite company. I have seen many press scrums, but never like this. It was scary. People were tripping, falling and being shoved out of the way. Cameras were dropped. What I saw was polite routines and traditions breaking down as the American political order reoriented itself around a new center of gravity. As the shouts and cries intensified, I found myself being drawn toward the bedlam.


      September 30, 2015 at 7:58 PM

  23. The real problem with the tax plan is that there should be three more brackets with higher income and cap gains rates (as well as estate taxes) for those with a net worth over $100M, $1B and $10B. Bezos made $16.5 Billion last year. It’s pretty dishonest to lump him in with those making $300K. Billionaires are always complaining that their taxes aren’t high enough. So why can’t we have a billionaire tax bracket just for them?


    September 30, 2015 at 7:35 PM

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