Senate Democrats offer bill to scrap tax break for investment managers
Source: The Hill
A group of Senate Democrats on Wednesday introduced legislation to end the "carried interest" tax break that benefits investment managers, after President Biden also called for scrapping the tax preference as part of his human infrastructure plan.
The tax break for carried interest allows investment managers to pay taxes on certain compensation income at capital gains rates, rather than ordinary income rates. The senators' bill would require carried interest to be taxed at ordinary income rates. The current top ordinary income rate is 37 percent, while the current top capital gains rate is 20 percent.
Democratic Sens. Tammy Baldwin (Wis.), Sherrod Brown (Ohio) and Joe Manchin (W-Va.) took the lead on offering the bill, which has more than one dozen Democratic senators sponsoring it in total. Brown is a prominent progressive while Manchin is a prominent centrist, indicating widespread support in the Democratic caucus for ending the carried-interest preference.
"Currently, there is a loophole in our tax code that allows investment managers to pay less taxes for wage income than the ordinary West Virginian and American worker. This legislation would close this loophole to ensure wealthy hedge fund managers are paying the fair amount in taxes," Manchin said in a statement. "I urge my colleagues on both sides of the aisle to support this commonsense legislation that treats all workers fairly."
Read more: https://www.msn.com/en-us/news/politics/senate-democrats-offer-bill-to-scrap-tax-break-for-investment-managers/ar-BB1gEwWc?li=BBnb7Kz
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