In the course of a fairly typical “takeover candidates” article at TheStreet.com, Rich Masino went off on a bit of a tangent that was actually more interesting than the meat and potatos of the piece.
Masino talks about the hotly-debated proposed Financial Transaction Tax and some other onerous taxation issues for the investor class…
From RealMoney (TSC):
While we’re on the subject, I’d like to weigh in on this subject of a financial transaction tax. Simply put, it’s indefensible, and it exhibits a terribly flawed logic that would be akin to taxing a merchant on top-line sales in addition to bottom-line profit.
I would add that investors already suffer from a number of tax injustices, among them:
- Dividends are taxed twice (once at the corporate level and again at the individual level).
- Capital losses beyond $3,000 can only be offset against capital gains.
- Investment expenses are not deductible for those investors who fall into the alternative minimum tax.
- There’s no such thing as a lower long-term gain on a short sale.
- Capital gains are not indexed to inflation.
Lastly, it hasn’t exactly been a picnic for the average investor, as the market is in virtually the same place it was a decade ago, and there have been many traumatic events along the way. Meanwhile, thanks to inflation, the purchasing power of a static portfolio has declined by nearly one-fourth over the last 10 years.
Many of these points will be lost on Congress. To read the rest of Rich Masino’s article, follow the link below.