Tuesday, May 28, 2019

Eliminating The Capital Gains Tax :: essays research papers

Eliminating The Capital Gains Tax     One of the major obstacles facing all entrepreneurs in the United Stateswhen starting a new business or expanding an existing one is raising capital.Here capital refers to money that people invest in a business. Investment andentrepreneurship are the heart and soul of a lively economy. There is no othereconomic task more important than invest ones capital into new ideas and newenterprises. Therefore capital raised from one person or a group ofprofessional investors remains a critical source of funding for these type ofenterprises. In the type of economic world which is present today theopportunity for good returns on a persons money moldiness be in abundance to allureinvestments in such ventures. Capital gains tax revenuees significantly diminish thesereturns, therefore reducing the incentives to invest. Eliminating the capitalgains tax will igniter entrepreneurship and new investments in the economy, whichin turn will el evate economic result and increase the number of jobs. In orderto stimulate economic growth in the United States, taxes on capital gains shouldbe eliminated.     Members of Congress once considered a reduction in the capital gains taxrate from 28% to 19.8%. combine with indexation, which is,reducing the capital gains tax by any amount would be a vital pro-growth steptaken by Congress. However, conkn the fickle and higher(prenominal) risk nature ofinvestments and entrepreneurships, and the importance of maintaining acompetitive economy in a global environment, capital gains should be exempt fromtaxation altogether. A cipher portion capital gains tax would attractentrepreneurial risk taking, which is very important to economic growth. Itwould entice wealthy investors to invest in a reliable enterprise, which in smallnumbers would immensely increase the economic growth in the United States. Inthe Wall Street Journal the U.S. Commission on civil rights said, & quotReducing thetax on capital gains effectively increases the flow of financial seed corn tobudding entrepreneurs." Also, from a global perspective, the United States hasone of the biggest capital gains tax rate. Depending on inflation, sometimesthe United States has the largest capital gains tax rate in the world. In acompetitive global economy a zero percent capital gains tax rate would make theUnited States a haven for capital, which in the long run will spark economicgrowth in the United States. Eliminating the capital gains tax altogether wouldnot only promote a "boom" economy in the United States but will give the UnitedStates an edge that it needs to compete in the global world, not to mentioncreate new jobs.     The potential benefits for eliminating the capital gains tax are clear.

No comments:

Post a Comment

Note: Only a member of this blog may post a comment.