Wednesday, May 14, 2008

Larry the Loophole

Thanks to the US-based group Citizens for Tax Justice, we have noticed this short but cheerful online cartoon (starring: Larry the Loophole) with a petition to the US presidential candidates. CTJ described it like this:

"The most recent video explains the tax loopholes used by the industry, including the loophole for "carried interest," which is basically compensation paid to fund managers for managing other people's money. Although the video does not use the term "carried interest," it does explain that these super-wealthy fund managers are allowed to pay taxes on their compensation at the special low 15 percent rate reserved for capital gains.

Many were disappointed last year when the Senate failed to approve a House-passed bill that would have closed the carried interest loophole and clamp down on the fund managers' use of offshore tax avoidance schemes. Hundreds of organizations had publicly endorsed the effort to close the carried interest loophole.

For its part, the private equity industry/buyout industry seems to know that the loopholes it enjoys still infuriate some members of Congress and the public. KKR just hired Ken Mehlman, the former chairman of the Republican National Committee, to run its public affairs department, demonstrating real concern that Congress may move to check the unfair advantages the industry enjoys."

Take a look.


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