Carried interest tax loophole lets Wall Street execs avoid paying fair share
WASHINGTON, D.C. (March 14, 2019) — Sen. Tammy Baldwin (D-Wisc.) and Rep. Bill Pascrell (D-N.J.) are (re)introducing the Carried Interest Fairness Act, which would close the carried interest tax loophole. This loophole is one of the most extreme examples of Wall Street privilege and allows private equity and hedge fund managers to misclassify their salaries as investment income, and pay a much lower income tax rate than teachers, firefighters and nurses.
“The carried interest tax loophole is the single most outrageous loophole in the tax code,” said Damon Silvers, AFL-CIO Director of Policy and Special Counsel. “It forces the American taxpayer to subsidize the pay of Wall Street titans that conduct job-killing leveraged buyouts and charge pension investors exorbitant fees. President Trump promised to close it in the 2016 campaign and yet the GOP tax bill left it in place. It’s time for Congress to end this loophole for good.”
TAKE A STAND — Please click here to sign an AFL-CIO petition to support this legislation and close the carried interest tax loophole.
The carried interest tax loophole was left intact in the Republican’s rewriting of our tax laws, despite the fact that voters across the political spectrum oppose it by a margin of 75 percent to 20 percent. Closing this loophole could raise an estimated $14 billion in revenue over 10 years for services and investment our communities direly need.
“For years, the carried interest tax loophole has allowed some of the wealthiest people in this country to pay a lower tax rate than millions of middle-income workers,” said Chris Shelton, President of the Communications Workers of America (CWA). Meanwhile, our country’s infrastructure is crumbling, our young people struggle to pay college tuition, and critical programs like Social Security and Medicare are constantly under threat. It’s time to close the carried interest loophole and make Wall Street pay its fair share.”
“The Carried Interest Fairness Act will help correct an economic injustice that gives massive tax breaks to the extremely rich and powerful at the expense of everyone else,” said AFSCME President Lee Saunders. “Millionaire and billionaire hedge fund managers are getting away with paying a significantly reduced tax rate on the so-called “carried interest” income they receive from other people’s investments. It’s unconscionable that working families pay more because of loopholes designed to benefit the wealthy and well-connected. It’s time to unrig the economy and insist that everyone pay their fair share. AFSCME thanks Senator Baldwin and Representative Pascrell for their leadership and urge other members of Congress to stand with working families and support this legislation.”
Most of us believe hard work should be rewarded fairly. But greedy financial executives have spent millions on a loophole that lets them to pay lower tax rate than teachers and nurses. Please add your name to the petition calling for its closure.