09.28.15

Support Grows for Baldwin-Levin Tax Reform Legislation

Patriotic Millionaires, AFL-CIO and Americans for Financial Reform Support Closing Carried Interest Loophole for Hedge Fund Managers to Invest in Economy that Works for Everyone

WASHINGTON, DC U.S. Senator Tammy Baldwin (D-WI) and House Ways and Means Committee Ranking Member Sander Levin (D-MI) today announced growing support for tax reform legislation they have introduced to end the carried interest loophole that has allowed wealthy investors to pay lower interest than average Americans.

In June, Senator Baldwin and Ranking Member Levin introduced the Carried Interest Fairness Act of 2015. The legislation would end the carried interest loophole and ensure that income earned managing other people's money is taxed at the same ordinary income tax rates as that of the vast majority of Americans.

“If you ever need proof that money corrupts our political system, look no further than carried interest,” said Patriotic Millionaires Executive Director Erica Payne. “Now is a time when both congressional Republicans and Democrats can show that they will not be intimidated by wealthy hedge fund managers. It is clear that now is the time to bring the Carried Interest Fairness Act of 2015 for a vote.” The Patriotic Millionaires is a group of more than 200 Americans with annual incomes over $1 million and/or assets of more than $5 million

Americans for Financial Reform and the AFL-CIO are also calling for Congressional action on the tax reform measure.

"It's a matter of basic fairness to end the carried interest loophole and raise revenue by equalizing tax rates between wealthy Wall Street fund managers and ordinary workers. Leaders across the political spectrum have endorsed this change. It's past time for Congress to take action and plug the carried interest loophole," said Americans for Financial Reform Policy Director Marcus Stanley.

“For far too long, Wall Street titans who make millions from leveraged buyouts have gotten away with paying a lower tax rate on their income than teachers, firefighters and other people who work for a living,” said AFL-CIO Director of Office of Investment Heather L. Slavkin Corzo. “It’s time to put an end to the carried interest tax loophole. We commend Senator Baldwin and Ranking Member Levin for proposing legislation that would put a stop to this unfair practice.”

The non-partisan Joint Committee on Taxation (JCT) estimated that the Baldwin-Levin legislation to close the carried interest loophole would raise $15.6 billion in revenue.

Several weeks ago President Barack Obama called for bipartisan work to repeal the carried interest tax loophole. “Keeping this tax loophole, which leads to folks who are doing very well paying lower rates than their secretaries, is not in any demonstrable way improving our economy,” President Obama said on September 16 in remarks at a Business Roundtable meeting in Washington.