The Other Tax Breaks for the Rich (the ones the Republicans don't want to talk about)
http://www.nytimes.com/2012/11/17/opinion/the-other-tax-breaks-for-the-rich.html?_r=0
To raise the roughly $1 trillion over 10 years that would be collected simply by letting the high-end tax rates expire, as President Obama has called for, would require huge cutbacks in tax breaks that most Americans don’t consider loopholes, including the deductions for mortgage interest and for state and local taxes. Another problem with the Republican plan is that even as it claims to broaden the tax base, it takes an important part of the base off the table from the outset.
Much of the debate has focused on the high-end tax rates, which will rise to 39.6 percent from 35 percent if the tax cuts expire on Dec. 31. But the end of the tax cuts also means the end of the low rates on investment income. The top rate on long-term capital gains will rise from 15 percent to 20 percent, and the top rate on dividends will rise from 15 percent to 39.6 percent, the same as ordinary income.
The special low tax rates for investment income are among the largest tax breaks in the code. They allowed investors to pocket some $100 billion in 2012 alone compared with what those investors would have paid if investment income were taxed the same as regular income.
And yet, because Republicans are wed to the notion that tax rates must never rise, this particular loophole would be untouched under their plan to broaden the base. In the end, for the sake of raising much-needed revenue efficiently and fairly, there is no substitute for letting all of the high-end tax rates expire, once and for all.
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