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Capital Gains Tax Cut: Some Other Thoughts

March 15, 1992

What Tom Petruno conveniently left out is the fact that the capital gains tax rate advantage was eliminated in conjunction with a substantial reduction of tax rates.

To have reduced the tax rates and continue with a reduced capital gains rate could hardly be justified, then or now. No one mentions that, particularly our President, who definitely must have some special interest in mind.

I for one would benefit from such a reduction, so this letter is not sour grapes. It is a matter of telling the whole story. Neither I nor anyone else I know would take their tax savings and invest them in industry or a business.

There is no substantiation that such a reduction would really help the economy. Why do many in industry prefer the tax cut on capital gains in lieu of credit for R&D?

If my information is correct, I understand that America has the lowest tax rates, the largest deficit and is currently in a recession. Does Petruno really believe a reduction in the capital gains tax rate is going to help the economy?

LEO BIALIS

Thousand Oaks

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