In the News
Phil Gaeta: Capital gains tax is double taxation
To the editor:
To say someone, whether it is Warren Buffet or Mitt Romney is only paying 15 percent income tax is misleading.
Capital gains tax is double taxation. As a stock owner you are an owner of a company, whether it is whole or a piece of such. If that company made $1,000 profit after expenses, you should be able to get a piece of that profit. However, the government taxes your corporation at a 35 percent tax rate, which equals $350. Now the profit that is left is $650. You get that or part of in dividends. Now the government taxes you again (double taxation) in the form of capital gains tax of 15 percent which is $97.50. From your original investment you have paid $350.00 corporate tax (35%) and $97.50 for Capital gains tax of 15% which comes out to be $447.50. Your effective tax rate minus any smoke and mirrors that the media portraits is in reality 44.75% not 15 %.