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An increase in the capital gains tax is basically an increase in government business ownership. For example, if the government increases capital gains by 10% they effectively own 10% more of your business. Because if you ever sold your business the government would take that percentage of the profit. When the press talks about who is impacted by potential capital gains hikes they focus on rich fat cats. But the truth is that millions of small business owners and retirees are the ones who really take the biggest hit.
I try not to stray into political discussions too often. I’m not a card carrying member of any political party and I think you will find plenty of crooks on either side of the aisle. That being said I shake my head in amazement when I hear politicians talk about equality and fairness. Recent legislation offered by State Representative Ann Lenczewski (D) in Minnesota strikes me as ethically bankrupt.
Ann’s basic pitch is that a portion of the property taxes that Minnesotans pay should be based on their income. For example, let’s say my home is exactly the same as my neighbor’s home and I have a higher income than he does. According to Ann’s math my neighbor should be able to claim a larger property tax deduction than I can. So in a weird twisted way the lower my income the more benefits I get from property ownership. If my income is higher than my neighbor’s I’m already paying more income taxes. Policies like this seem inherently divisive.
