He went even further on Fareed Zakaria's show. David Stockman said ALL income should be treated the same.
One thing they should absolutely do it not allow people to paid via dividends.
Despite my pretty darn liberal views on taxation, I disagree with this. I can see the justification for a lower capital gains tax rate than for ordinary income - I think it genuinely does stimulate investment. On the other hand, I don't think there should be any concept of a "qualified dividend." I just don't see the same justification - there are plenty of non-dividend paying companies that people invest in and I just don't see my clients with $30 million of KO stock selling because those quarterly dividends are now going to be taxed at ordinary income rates. On the third hand, I also don't think dividends should be subject to FICA/self-employment taxes (except in the case of the so-called "John Edwards loophole" - corporate tax guys correct me if I am wrong, but I just don't see this happening with C corps, except in very rare circumstances).
Except that the income left over to pay the dividend has already been taxed once at the corporate level. Cue the argument about corporate tax loopholes, but that's no reason to punish the shareholder that receives the dividend--fix the damn tax code first and then look at tax rates.
Despite my pretty darn liberal views on taxation, I disagree with this. I can see the justification for a lower capital gains tax rate than for ordinary income - I think it genuinely does stimulate investment. On the other hand, I don't think there should be any concept of a "qualified dividend." I just don't see the same justification - there are plenty of non-dividend paying companies that people invest in and I just don't see my clients with $30 million of KO stock selling because those quarterly dividends are now going to be taxed at ordinary income rates. On the third hand, I also don't think dividends should be subject to FICA/self-employment taxes (except in the case of the so-called "John Edwards loophole" - corporate tax guys correct me if I am wrong, but I just don't see this happening with C corps, except in very rare circumstances).
mike, you've got to admit that it's pretty messed up that someone gets taxed less for giving their money to the pencil pushers than they do for a honest day's hard work. Let's invest in the American worker.
We're not going to solve unemployment with people just investing in the same old companies. Take that money and start new businesses.