Why Tax Capital Gains?
by John C. Goodman
April 14, 2012
Income tax time is an appropriate moment to go to the heart of President Obama’s complaint about the taxes Warren Buffett and other rich people pay, or don’t pay. What the president is really complaining about is that the tax rate on capital gains is too low.
But there is a more basic question to be asked: why tax capital gains at all?
Did you know that the term "capital gains" does not even appear in the official income accounts for the U.S. economy? That’s right. No matter how high stock prices climb, they do not affect the official reckoning of national income one iota.
"Capital losses" aren’t included either.