Crapo, Roskam Introduce Legislation to Permanently Cap Capital Gains and Dividend Tax Rates at 15 Percent
Broad coalition of American job creators send letter in support; impending tax-hike would hit seniors, businesses, investors of all sizes
Washington, D.C. - Idaho Senator Mike Crapo, a member of the Senate Finance Committee with oversight on tax issues, joined Representative Peter Roskam (R-Illinois), Chief Deputy Whip and member of the House Ways & Means Committee, to introduce legislation in both the U.S. Senate and House of Representatives to permanently cap the capital gains and dividend tax rates at 15 percent. Crapo and Roskam say the legislation is needed to avoid an impending tax hike that would particularly affect American businesses, seniors and investors of all sizes.
The sunsetting of the current tax rates of the last decade, set to expire at the end of 2012, coupled with a guaranteed new 3.8 percent tax from the President's Healthcare law, starting in 2013, would mean effectively a 58 percent higher tax rate on capital gains and as much as a 189 percent higher tax rate on dividend income. The Crapo and Roskam bills have support from a broad coalition of 27 American businesses and organizations.
"Pro-growth tax policy that will generate investment, capital formation and job creation is critical to reversing the uncertainty and sluggishness in our economy," said Crapo. "Providing certainty for farmers and ranchers, along with other business owners and investors, starts with the guarantee of fair and competitive tax reform, and that reform starts by stopping increases in capital gains and related investment taxes."
"With near double-digit unemployment, fostering a competitive and stable environment for job creation is critical for turning the American economy around," said Roskam. "A critical first step is removing uncertainty and making these tax rates permanent. If we don't act, Americans who rely heavily on these current rates - from seniors to businesses to investors of all kinds - will be severely negatively impacted. Instead of adding more barriers to private-sector job creation, let's choose to foster a culture that encourages investment, capital formation, and economic growth."
The Alliance for Savings and Investments (ASI) - a diverse group of 27 dividend-paying companies, investor organization, and trade associations - sent letters in support of the legislation. They write, "Lower investment tax rates don't just benefit direct shareholders; they benefit the tens of millions of Americans who own stock indirectly through mutual funds as well as stock held through life insurance policies, pension funds or 401(k) plans," the coalition members said. "Allowing the rates to increase will undermine economic recovery efforts."