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Capital Gains Tax Issue in the U.S.

This research explores the capitalgains tax issue in the United States. The major controversy concerns whether or not to reduce the tax rate on capitalgains to some level below that for ordinary income, which is the basis for the taxation of capitalgains under the Tax Reform Act (TRA) of 1986. Although the proposal by the Bush Administration to reduce the tax rate on capitalgains was defeated in the Senate in the fall of 1989, the issue remains very much alive (Yang, 1989).

The nation's media generally and the Bush Administration more specifically have attempted to protray the controversy over the capitalgains tax as a liberal/conservative clash. Such a depiction suits the Administration, because, as was true of the Reagan Administration which preceded it, it hopes to make points with the public by avoiding a discussion of hard facts, and, instead, deal with the issue on an emotional level where it can blame all of the nation's troubles on evil liberals and socialists. That intellectual giant and stalwart defender of the conservative cause, Representative Bob Dornan (1990), R. Cal., has been kicking the dead socialist horse as hard as he can on the capitalgains tax issue, in defending the Administration's position on the floor of the house.

In point of fact, agruments on the capitalgains tax issue cut across liberal/conservative lines, to a point where an

attempt to assess the issue strictly in terms of American liberal and conservative political ideologies tends to obfuscate the points of contention (Birnbaum, and Rogers, 1989). A more effective assessment of the issue may be obtained through a consideration of the arguments on their merits, without invoking liberal and conservative bogeymen from America's political closet.

THE ARGUMENTS FOR AND AGAINST A REDUCTION IN

There exists a wide variety of arguments both in support of and in opposition to proposals to reduce the tax rate on capitalgains. Many ...

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Capital Gains Tax Issue in the U.S.. (1969, December 31). In LotsofEssays.com. Retrieved 10:48, March 29, 2024, from https://www.lotsofessays.com/viewpaper/1691359.html