Capital Gains Tax

President Bush, preparing to present his budget to Congress today, will propose restoring a tax break for capital gains but limiting it to stocks and similar investments held for at least three years, Administration officials said Wednesday. For the fiscal year that begins Oct. 1, Bush will project a deficit of about $98 billion, sources said, slightly higher than the $92.5-billion deficit that former President Ronald Reagan had projected.

WASHINGTON - Eduardo Saverin fled Brazil as a boy and lived the American dream by helping found Facebook Inc. Now two U.S. senators want to make sure he never sets foot in the U.S. again unless he pays tens of millions of dollars in taxes he will owe after the company's initial public offering Friday. Saverin renounced his U.S. citizenship this year and is living in Singapore, a country with no capital gains tax. Sens. Charles E. Schumer (D-N.Y.) and Bob Casey (D-Pa.) denounced him Thursday as a tax dodger and introduced legislation to punish anyone who gives up citizenship to duck big tax bills.

The tax bill that emerged from the Senate Finance Committee is worse than the one that went in. The senators dropped the destructive BTU tax on energy but substituted an even more destructive surtax on capital gains. This pushes the capital-gains tax rate up to 30.8%, a rate that is high both absolutely and in relation to other countries. This inappropriate increase comes at a time when House members such as Herbert C. Klein (D-N.J.

Apparently, some people were expecting a more subdued Newt Gingrich to emerge after two straight losses in the Republican presidential campaign. Nope. Coming off a double-digit shellacking in Nevada, a state Mitt Romney carried in 2008, Gingrich waved off the results as expected and vowed to press on despite a lack of debates in the coming weeks that might keep him in the spotlight. He's said he hopes to close Romney's widening delegate lead by the Texas primary in April. As he did after Saturday's caucuses, Gingrich railed against Romney on two Sunday morning TV shows, attacking the former governor's record leading Massachusetts.

An uncommon burst of good sense gripped leaders of the U.S. Senate the other day and they agreed to strip all the extraneous non-essential items from the budget bill, including consideration of a capital-gains tax cut and a variety of outrageous special-interest provisions. Still, the action came too late to avoid what Washington has dreaded ever since 1985: imposition of across-the-board spending cuts under the Gramm-Rudman deficit reduction act on Monday.

President Bush announced Tuesday that he will nominate William Lucas, a black lawyer who has been criticized by some leading civil rights organizations, to head the Justice Department's Civil Rights Division. Lucas, former sheriff and chief executive of Michigan's Wayne County, which includes Detroit, has a background in law enforcement but virtually no experience with federal civil rights laws. His background has led the NAACP, among other groups, to oppose his nomination. White House officials, however, have dismissed the opposition, suggesting that it is motivated primarily by partisanship.

Business executives and investors are anxiously awaiting President Bush's election-year budget proposal, hoping that it will be replete with tax breaks and other goodies designed to help boost the economy and get voters smiling again. The budget, to be previewed Tuesday in the State of the Union address and unveiled Wednesday, will set the stage for a months-long political drama.

WASHINGTON - Eduardo Saverin fled Brazil as a boy and lived the American dream by helping found Facebook Inc. Now two U.S. senators want to make sure he never sets foot in the U.S. again unless he pays tens of millions of dollars in taxes he will owe after the company's initial public offering Friday. Saverin renounced his U.S. citizenship this year and is living in Singapore, a country with no capital gains tax. Sens. Charles E. Schumer (D-N.Y.) and Bob Casey (D-Pa.) denounced him Thursday as a tax dodger and introduced legislation to punish anyone who gives up citizenship to duck big tax bills.

Summa cum aes alienum (debt)--because of capital gains tax! Stock for college, received at age 7 months, will be taxed 18 years later when sold for tuition. I fear this will still be true in two years, for my grandson. A longer-term (10 years) tax rate of 0% would avoid taxing inflation and education or retirement money saved after taxes. June is for dads and grads, except for the tax law. FRANK ATHA Pacific Palisades

The rationalization for the cut in capital gains tax is that it is another way for the economy to grow. If this type of economy must grow in order to thrive (or exist) then we might as well cash in the chips right now. There will inevitably come a time when growth is no longer possible. The cut in capital gains tax is just another gift to the rich, let's call it like it is. Lies too will come back to haunt us. JAMES STONE Fresno

The future of California's public schools, universities and health programs could be linked partly to the fictional town of FarmVille. The popular virtual world is the creation of Zynga, a San Francisco online game company that raised $1 billion in an initial public stock offering last year. Because California receives much of its income from capital gains taxes, such moves by businesses like Zynga can mean hundreds of millions of dollars for state coffers. More California technology companies are poised to go public this year - including a widely expected $10-billion offering from Facebook - than at any time since the dot-com boom, experts say. Their success could relieve state officials of the need to cut state services more deeply in the budget year that begins in July, but Gov. Jerry Brown and his fellow Democrats are already squaring off over whether to count on the fruits of those transactions.

There's an e-mail going around warning that anyone who sells their home after 2012 "will pay a 3.8% sales tax on it" to help fund President Obama's healthcare reform law. "Oh, you weren't aware this was in the Obamacare bill?" says the e-mail, which is being forwarded by many people but the origins of which remain a mystery. "Guess what, you aren't alone. There are more than a few members of Congress that aren't aware of it either. " The e-mail was called to my attention by Chino resident Ken Burton, who wanted to know whether it was legit.

Is it too much to ask that the best-financed statewide political campaign in the country — maybe in U.S. history — get things right about a central tenet of its electoral platform? The question arises from GOP gubernatorial candidate Meg Whitman's new glossy campaign brochure, titled "Creating Jobs for a New California." In it she proposes killing the state tax on capital gains. "California is one of a few states in the country that taxes capital gains at a higher rate than traditional income," the booklet states.

Britain's new coalition government on Tuesday unveiled the country's most painful budget in a generation, outlining a program of deep spending cuts and tax hikes in line with the mood of public austerity sweeping across Europe. George Osborne, chancellor of the exchequer — Britain's equivalent of Treasury secretary — said drastic measures affecting everyone were unavoidable to mollify jittery investors and tackle the nation's biggest national deficit since World War II. The emergency budget calls for rises in sales and capital gains taxes and reductions in welfare benefits to help erase the government deficit within six years.

A major feature of Republican Meg Whitman's plan to create jobs as governor is to eliminate the state tax on capital gains. Not merely tax investment profits at a lower rate than wages, as the federal government does, but scuttle the state tax completely. Most people don't need to worry about paying taxes on capital gains. They're not so fortunate. But a relatively few wealthy Californians pump substantial sums into the state treasury, which would leak even more red ink if those payments ceased.

Meg Whitman's Republican rival calls her a liberal. He's not even close. Political writers often describe her as moderate. That misses the mark too. Supporting abortion rights -- even state funding of abortions for the poor -- doesn't automatically make her a moderate. Not when she's prepared to whack benefits for welfare moms -- slash almost any program -- to avoid raising taxes. She opposes same-sex marriage but supports recognizing those unions allowed before Proposition 8 passed.

Re "An absolute menace," Opinion, March 13 Does the Club for Growth actually think that labeling moderate Republican senators "comrade of the month" means anything at all to the majority of American voters? I doubt that most people make the connection between comrade and communist. How many American voters even know who Karl Marx was? Next will the Club for Growth be calling Sen. Arlen Specter (R-Pa.) a Wobbly? Isn't it time somebody told former Rep. Pat Toomey (R-Pa.) and the Club for Growth that Red-baiting went out with Joe McCarthy?

SHOULD MANAGERS OF takeover firms be encouraged by the tax code to receive a share of the profits from a restructured company's eventual sale? The question might bore even accountants, but billions of dollars of profits and potential tax revenues are at stake. That's why the Senate Finance Committee is considering classifying the managers' payday as ordinary income, subject to tax rates as high as 35%, instead of as long-term capital gains, which are taxed at 15%.