Both houses of Congress came back into session after the holiday weekend and on the top of their agendas are separate proposals to increase the taxes on private equity firms. Today both the Senate and the House of Representatives will hold major hearings to discuss the tax hikes.
The witness lists for today's hearings include both Bruce Rosenblum of the Carlyle Group, Russell Read, the chief investment officer of CalPERS and Victor Fleischer, the University of Illinois law professor who is sometimes called the intellectual godfather of private equity tax hikes.
Meanwhile, special interest lobbying groups are lining up both for and against the tax hike. Yesterday two groups announced their opposition, and one labor dominated pension fund trade group switched sides to support the move. In opposition we have the Chamber of Commerce and the Access to Capital Coalition, a group concentrated on encouraging access to capital for businesses owned by minorities and women. The latter group includes Magic Johnson.
The flip flopping pension fund group is the National Conference on Public Employee Retirement Systems. Earlier it had come out against the proposed hikes but now has said it won't oppose them.
Big Day in Washington for Carried Interest Debate [New York Times]
Private Partnership Tax Fight Heats Up [New York Post]
Posted by vinniedkator, Sep 06, 2007 11:16AM
"Pension funds are among the biggest investors in buyout and venture-capital funds and other pools of private capital that could wind up paying ordinary income tax rates on so-called "carried interest" - or the profits they make from investments - instead of the lower capital gains rates they now pay. That would bump up their taxes to 35 percent from 15 percent."
This paragraph is wrong in so many ways. Get your facts straight, Ms. Janet Whitman. This is why the New York Post should never be referenced for anything that requires thought.