Fox Business reported:
Public policy groups and some lawmakers have called for eliminating the carried interest deduction as a form of welfare for the rich, since private equity companies and their investors so heavily benefit from the loophole that allows for profits on their holdings to be taxed at a lower rate than ordinary income. During the 2016 presidential campaign, then-candidate Trump said he would end the deduction for everybody during his populist push to win the White House while noting that average families pay a higher income tax rate than executives from this industry.
Regan explained that it allows hedge fund managers to pay a lower percentage of tax than a cop or a fireman. She said there many positive aspects to the new tax bill, which passed in Congress this week, but the carried interest loophole is staying because of the huge contributions from Wall Street to lawmakers.
For instance, she said Blackstone chief Steve Schwarzman, a close ally of President Trump, gave more than $3 million to a super PAC linked to Mitch McConnell. But she said the big donations went to both parties, ensuring influence for Wall Street regardless of who won.
"Why does no one bother to address it? Because the campaigns are bankrolled by the industry, meaning the swamp is alive and well," she said.
Trump vowed to close the loophole on the campaign trail, alleging that Wall Street and special interests were supporting Hillary Clinton for that reason.
Want to know WHY the #carriedinterestloophole is STILL in the tax bill?! Because the Private Equity fat cats who BENEFIT from this have been donating MILLIONS to lawmakers! In other words, the swamp is alive and well! THIS IS WRONG! pic.twitter.com/RbW9irTSQ1
— Trish Regan (@trish_regan) December 21, 2017
The private equity industry claims the loophole allows them to create jobs through increased investment.
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