7 ms·

Microsoft CEO sells half his stock, weeks before WA state implements gains tax

40 points by samspenc 5y ago

systemvoltage 5y ago
I predict that people will leave Washington State in droves. Not because of the tax increase, but because the amount of taxes you pay goes into never ending government pit of inefficiency and incompetency. I’m down with paying more taxes but in return I want no homelessness, no chadzone, less crime, better roads, straight forward education (math is racist apparently), spotless streets, safety, eradication of poverty, no power cuts, and better law enforcement. Better yet, instead of increasing taxes, how about we improve the efficiency of the government? For same budget, we can get more done. We never seem to ask this question.
- mountainriver 5y ago
  Good point, it is rarely talked about how we increase efficiency. I wish there was a better way to inject free market competition into the government. Government contracts seem to also favor inefficiency and poor implementation. Something I’ve been thinking on lately, if anyone has resources on this I would love to read them.
  - ren_engineer 5y ago
    >I wish there was a better way to inject free market competition into the government it's called immigration, people move to states/nations with the best functioning governments if they are allowed free movement. Historically voting with your feet has been the best way to change government. See Illinois and it's massive budget shortfall due to people leaving the state also look at the Soviet Union which needed border security to keep people IN. The exact opposite situation that the US has, which is that millions of people want to live here through any means necessary
    - waz0wski 5y ago
      In my cynical view within the US, it's often more like locusts destroying their environment and moving on e.g. the Californian exodus to other western states that is negatively regarded by most people born & raised in those states. People vote for crap politicians and policies that lead to issues noted in the OP, then go somewhere else and do it again - watching it first-hand in my state over the past decade.
    - tiernano 5y ago
      > See Illinois and it's massive budget shortfall due to people leaving the state Does this really make them think of changing stuff, or will they just increase taxes and try get more money? I mean, most governments will do the latter before fixing the issue (they don't want to admit the issue is with them...) [NOTE] not a US citizen, so cant don't know much about US politics
      - OldHand2018 5y ago
        Illinois budget problems are due primarily to pension promises made decades ago. The current state government is reasonably well run, for the most part. If you look at the 2020 Census data, the Chicago metro area grew slightly while the rural areas and small towns lost population. The state saw a growth in high earners that pay lots of taxes, and a loss in lower income folks that pay relatively low taxes. Since you mention politics: Illinois will send 1 fewer person to the US Congress next year. Currently, there are 13 Democrats and 5 Republicans from Illinois. After the elections next year, there are almost certainly going to be 14 Democrats and 3 Republicans. Knowing that might help understand some of the criticism…
  - systemvoltage 5y ago
    Journalists should be holding governments accountable. Just the way Carreyrou (WSJ) single handedly brought down Theranos, I want journalists to go after government corruption and high impact inefficiencies. Notice how NYTimes and the like are not interested in actual journalism of this sorts. Government is a de facto monopoly and we need 10x more eyes on it than anyone else. There needs to be mechanisms for firing bad actors from high up positions. Instead, the focus is always on increasing taxes. As a liberal, I want my taxes to go into exceptional and super high quality services that even the Scandinavians would envy. Otherwise, I will vote for lower taxes and that could mean vote for republicans. Our governments suck so much.
    - 8note 5y ago
      The government has become pay to play for journalists. Piss the government off and your not allowed into press briefings anymore. Some dedicated investigative journalism group could do it, but any larger media company cannot. I could see folks on YouTube doing a good job of it?
    - GDC7 5y ago
      You keep dreaming. A journalist is a regular citizen who can write. They are motivated by hatred, that's why Cuomo, Trump and Elizabeth Holmes a juicy targets, but the inefficiency of the beurocracy and the government waste are not something they are interested in. Journalists also throw tantrums when they analyze a high profile person and find nothing on them. Journalists , like cops, judges etc. are not proactive , unlike engineers, their enemy is not a problem, but it's always another person. Their dream is basically them publishing a hit piece which would bring somebody big down, that's how they picture themselves, that's what they visualize when they are asked to define success. From there they try to go backwards trying to see what they have to do to make it happen.
- deleted 5y ago
  [deleted]
- GaryTang 5y ago
  Left WA and moved to FL last month. It feels like I went from North Korea to South Korea. Never realized how much greener it could be on the other side. What’s most surprising is how much better the small business environment is and how much more productive people are in general. The mosquitoes though are a nuisance.
- philipkglass 5y ago
  None of those issues (with the possible exception of roads, depending on which roads you mean) are state-level problems. I live in a smaller locale in Washington and these Seattle-area laments are not problems here.
- vvram 5y ago
  the same goes for CA as well.
- d22 5y ago
  What's chadzone?
  - travbrack 5y ago
    Pretty sure they're referencing https://en.wikipedia.org/wiki/Capitol_Hill_Occupied_Protest https://en.wikipedia.org/wiki/Capitol_Hill_Occupied_Protest
- mikestew 5y ago
  Not because of the tax increase, but because the amount of taxes you pay goes into never ending government pit of inefficiency and incompetency. From my POV, having lived here for 20 years, WA residents used to get a reasonable deal on their taxes. Sure, they were high from the perspective of this Midwestern boy, but the ferries ran on time and shit got done. I do not feel that's the case anymore (well, the ferries are probably still timely). I was just asking my wife the other day, "I don't mind high gas taxes per se, but for having some of the highest fuel taxes in the country, why is this highly-trafficked road such a piece of shit? They haven't paved it since we moved here." As one example; but where the hell is that money going? We don't even have hard winters to tear the roads up. Why are four-banger compact cars running practically open exhaust and rattling windows? Don't we do inspections anymore? Or have cops that pull people over for such things? Speaking of which, in Redmond I'm kind of surprised when I see a cop driving around anymore. Blah, blah, blah, no one outside of WA cares and those that live here know what I'm on about, so I'll cut it short. I'm with parent: I'll gladly pay taxes, they buy civilization. But lately I don't feel I'm getting as much civilization for my tax dollar as I used to, not even close.
  - toast0 5y ago
    > well, the ferries are probably still timely Someone isn't on the wsdot ferry email list (anymore?). Most of the lines are currently running single boat service, or only announcing both boats will be running in the morning. I don't personally count it as being on time if you're doing half the normal number of sailings, but those are mostly on time. I'll give a pass for the regular delays on friday afternoon and sunday evening though. As far as I know, those delays are like clockwork, and we're stuck with them. (Maybe when coleman dock construction finishes, the super peak times will run more smoothly, but I'm ok with just pretending the ferry doesn't run during those times, cause I don't want to be there)
  - thatfrenchguy 5y ago
    > I was just asking my wife the other day, "I don't mind high gas taxes per se, but for having some of the highest fuel taxes in the country, why is this highly-trafficked road such a piece of shit? They haven't paved it since we moved here." Suburbs in the US have too much roads per capita (thanks to SFH obsession), you'll end up with this issue almost no matter how much taxes you raise.
- AlexTWithBeard 5y ago
  New York State here. Some of the highest property and income taxes in exchange for - shitty expensive roads - just "meh" state university - the worst subway I saw in any country (and there were a few) and I can keep whinging for another half an hour.
  - joebiden2024 5y ago
    Stony Brook, Binghamton and the publicly funded colleges at Cornell provide excellent educations, and that’s disregarding the historical excellence of the CUNY schools. I’ll grant you the subways though.
  - mrgordon 5y ago
    You’re saying NYC has the worst subway? If so, you’re seriously taking it for granted. It’s the only subway I’m aware of with two sets of tracks so it can run 24 hours even while maintenance is performed usually. It’s better than basically any other subway in America as a start and certainly better than many others as well. That said, the United States is clearly terrible at public transport overall.
    - systemvoltage 5y ago
      You clearly have not been overseas. NY subways are possibly the filthiest, Ill-running subway system in the world. Frequent delays, crime, the stench, the cost; every single aspect of it is no match for say Tokyo subway or Prague metro. Improvement starts with self-introspection and realization. American exceptionalism is all I can see.
      - mrgordon 5y ago
        Well let’s see I spent the last five months in Lisbon, Barcelona, Paris, London, and Zagreb. Now I’m in Bangkok. So your assumption that I’ve never been overseas is drastically incorrect. In fact, I’d wager I’ve been to more countries than you have and I always use the subway when available. If you read my comment, I mentioned that while the US is poor at public transit in general, the NYC subway stands out for several reasons including being 24 hours, being able to perform track maintenance without shutting down due to having two tracks (something I believe no other system has), and it also has 472 stations! Prague has 61 stations and even Tokyo only has 280. So you ignored the fact that I said America isn’t good at public transit, ignored the reasons I cited that make the NYC system better in some ways than the systems you’re talking about, and instead responded with some misplaced condescension about “American exceptionalism” Stop making assumptions about strangers on the Internet instead of reading what they wrote.
- a45a33s 5y ago
  people will also be leaving due to lord inslee's neverending "emergency powers"
  - joebiden2024 5y ago
    Inslee has improved his margin in his 3 statewide elections so clearly the more WA citizens see of him the more they like him. His COVID response was excellent and the best in the country, IMHO.
- joebiden2024 5y ago
  Washington has one of the best universities in the country, excellent secondary education, and is home to two of the largest tech companies in the world. It’s a shining example of American excellence to the world, and you think people will leave because of capital gains? This is silly.
- devwastaken 5y ago
  Then campaign for election. The democratic experiment failed because people believe the government is a separate entity from them. Once you get involved you will see how complicated everything actually is. It turns out that people vote and do things purely from belief, regardless of if it's wrong. Therefore good policy gets labeled "leftist" or "conservative", and the private interests that profit from the chaos know how to prey on beliefs far better than you can.
  - systemvoltage 5y ago
    Think about the consequences of what you said. We can never know unless we get involved. It is too complex. So the door for criticism is shut and only the people inside the government can possibly know the intricacies and therefore have the right to criticize. This is also a classic defeatist perspective - we can never fix this, it is too complicated.
- abeppu 5y ago
  We should all be for greater efficiency of government. But ... is WA actually less efficient than other states? If so, how and why? In terms of overall tax burden, until now WA has been pretty middle of the road (ranked 24 and 27 out 50 in two estimates). https://taxfoundation.org/publications/state-local-tax-burden-rankings/ https://taxfoundation.org/publications/state-local-tax-burde... https://wallethub.com/edu/states-with-highest-lowest-tax-burden/20494 https://wallethub.com/edu/states-with-highest-lowest-tax-bur...
  - atdrummond 5y ago
    The burden has been middle of the road thanks to the income tax ban. It’s also resulted in the state pursuing taxes even worse than income tax, in terms of regressivity and who they target.
- kyleblarson 5y ago
  Seattle is not Washington State. I invite you to visit the Methow Valley. I will buy you a beer.
  - systemvoltage 5y ago
    I just googled Methow Valley. Breathtaking. I'll take your offer.
- janoin93 5y ago
  [flagged]
millzlane 5y ago
Sound like a move to avoid losses. TL;DR: Nadella sold the shares “for personal financial planning and diversification reasons,” the Redmond-based company said in a statement Monday afternoon. “He is committed to the continued success of the company and his holdings significantly exceed the holding requirements set by the Microsoft Board of Directors.”
- samspenc 5y ago
  But then, in the next two paragraphs: > It comes in advance of Washington state implementing a controversial new capital gains tax. Passed by lawmakers in April, it primarily targets stock and business ownership sales with a 7% tax on long-term capital gains of more than $250,000. > The first such tax in state history, it’s set to take effect on Jan. 1, 2022. Microsoft’s statement on Nadella’s stock sale did not address whether the impending capital gains tax factored into Nadella’s personal financial planning. A Wall Street Journal report cited analysts who pointed to a possible connection.
  - millzlane 5y ago
    He says why he did it. It's not a secret. We can speculate why he did it but with no proof how do we know? If he was trying to avoid the tax altogether why not sell all of it?
JoeyBananas 5y ago
Capital gains tax is a bad idea because it hurts businesses. It takes money out of the economy and puts it into the government where it is spent less efficiently.
- ttymck 5y ago
  I'm sure your argument is deeper, but what you have written could be said about any tax, no? Is there something unique about capital gains tax in particular?
  - pirate787 5y ago
    Capital gains taxes are double taxation...the company already pays income taxes on its profit.
    - nostrademons 5y ago
      That would be dividends. Capital gains (in theory at least) are the result of a company investing in its future earning capacity, eg. hiring scientists for R&D, building a new factory, spending money on SaaS upgrades, etc. These all come out of the income statement as expenses, and aren't recorded as profit, so the company doesn't pay corporate taxes on them. You'd potentially have a point for buybacks, which are usually paid off of retained earnings that have already been taxed and yet raise the share price and cause capital gains. This is the same issue that qualified dividends have though.
      - atdrummond 5y ago
        Those future earnings from present investments, when finally realized, will be taxed unless the corporate income tax is eliminated.
        nostrademons 5y ago
        But someone who sells a security backed by the cash flows from those future investments is receiving cash before the cash flows have materialized (or been taxed). There's also no guarantee that they will ever be taxed. Take, for example, a startup that continually reinvests all profits in additional R&D, sales, and marketing, gets increasing large revenue streams, but then sells the whole company to a bigger one before ever realizing a GAAP profit. Capital gains tax is Uncle Sam's way of taking a cut on all the intermediate owners who benefit from the business reinvestment but know how to turn profits into larger market share.

40 points by samspenc 5y ago

I predict that people will leave Washington State in droves. Not because of the tax increase, but because the amount of taxes you pay goes into never ending government pit of inefficiency and incompetency. I’m down with paying more taxes but in return I want no homelessness, no chadzone, less crime, better roads, straight forward education (math is racist apparently), spotless streets, safety, eradication of poverty, no power cuts, and better law enforcement. Better yet, instead of increasing taxes, how about we improve the efficiency of the government? For same budget, we can get more done. We never seem to ask this question.

mountainriver 5y ago
Good point, it is rarely talked about how we increase efficiency. I wish there was a better way to inject free market competition into the government. Government contracts seem to also favor inefficiency and poor implementation. Something I’ve been thinking on lately, if anyone has resources on this I would love to read them.
- ren_engineer 5y ago
  >I wish there was a better way to inject free market competition into the government it's called immigration, people move to states/nations with the best functioning governments if they are allowed free movement. Historically voting with your feet has been the best way to change government. See Illinois and it's massive budget shortfall due to people leaving the state also look at the Soviet Union which needed border security to keep people IN. The exact opposite situation that the US has, which is that millions of people want to live here through any means necessary
  - waz0wski 5y ago
    In my cynical view within the US, it's often more like locusts destroying their environment and moving on e.g. the Californian exodus to other western states that is negatively regarded by most people born & raised in those states. People vote for crap politicians and policies that lead to issues noted in the OP, then go somewhere else and do it again - watching it first-hand in my state over the past decade.
  - tiernano 5y ago
    > See Illinois and it's massive budget shortfall due to people leaving the state Does this really make them think of changing stuff, or will they just increase taxes and try get more money? I mean, most governments will do the latter before fixing the issue (they don't want to admit the issue is with them...) [NOTE] not a US citizen, so cant don't know much about US politics
    - OldHand2018 5y ago
      Illinois budget problems are due primarily to pension promises made decades ago. The current state government is reasonably well run, for the most part. If you look at the 2020 Census data, the Chicago metro area grew slightly while the rural areas and small towns lost population. The state saw a growth in high earners that pay lots of taxes, and a loss in lower income folks that pay relatively low taxes. Since you mention politics: Illinois will send 1 fewer person to the US Congress next year. Currently, there are 13 Democrats and 5 Republicans from Illinois. After the elections next year, there are almost certainly going to be 14 Democrats and 3 Republicans. Knowing that might help understand some of the criticism…
- systemvoltage 5y ago
  Journalists should be holding governments accountable. Just the way Carreyrou (WSJ) single handedly brought down Theranos, I want journalists to go after government corruption and high impact inefficiencies. Notice how NYTimes and the like are not interested in actual journalism of this sorts. Government is a de facto monopoly and we need 10x more eyes on it than anyone else. There needs to be mechanisms for firing bad actors from high up positions. Instead, the focus is always on increasing taxes. As a liberal, I want my taxes to go into exceptional and super high quality services that even the Scandinavians would envy. Otherwise, I will vote for lower taxes and that could mean vote for republicans. Our governments suck so much.
  - 8note 5y ago
    The government has become pay to play for journalists. Piss the government off and your not allowed into press briefings anymore. Some dedicated investigative journalism group could do it, but any larger media company cannot. I could see folks on YouTube doing a good job of it?
  - GDC7 5y ago
    You keep dreaming. A journalist is a regular citizen who can write. They are motivated by hatred, that's why Cuomo, Trump and Elizabeth Holmes a juicy targets, but the inefficiency of the beurocracy and the government waste are not something they are interested in. Journalists also throw tantrums when they analyze a high profile person and find nothing on them. Journalists , like cops, judges etc. are not proactive , unlike engineers, their enemy is not a problem, but it's always another person. Their dream is basically them publishing a hit piece which would bring somebody big down, that's how they picture themselves, that's what they visualize when they are asked to define success. From there they try to go backwards trying to see what they have to do to make it happen.
deleted 5y ago
[deleted]
GaryTang 5y ago
Left WA and moved to FL last month. It feels like I went from North Korea to South Korea. Never realized how much greener it could be on the other side. What’s most surprising is how much better the small business environment is and how much more productive people are in general. The mosquitoes though are a nuisance.
philipkglass 5y ago
None of those issues (with the possible exception of roads, depending on which roads you mean) are state-level problems. I live in a smaller locale in Washington and these Seattle-area laments are not problems here.
vvram 5y ago
the same goes for CA as well.
d22 5y ago
What's chadzone?
- travbrack 5y ago
  Pretty sure they're referencing https://en.wikipedia.org/wiki/Capitol_Hill_Occupied_Protest https://en.wikipedia.org/wiki/Capitol_Hill_Occupied_Protest
mikestew 5y ago
Not because of the tax increase, but because the amount of taxes you pay goes into never ending government pit of inefficiency and incompetency. From my POV, having lived here for 20 years, WA residents used to get a reasonable deal on their taxes. Sure, they were high from the perspective of this Midwestern boy, but the ferries ran on time and shit got done. I do not feel that's the case anymore (well, the ferries are probably still timely). I was just asking my wife the other day, "I don't mind high gas taxes per se, but for having some of the highest fuel taxes in the country, why is this highly-trafficked road such a piece of shit? They haven't paved it since we moved here." As one example; but where the hell is that money going? We don't even have hard winters to tear the roads up. Why are four-banger compact cars running practically open exhaust and rattling windows? Don't we do inspections anymore? Or have cops that pull people over for such things? Speaking of which, in Redmond I'm kind of surprised when I see a cop driving around anymore. Blah, blah, blah, no one outside of WA cares and those that live here know what I'm on about, so I'll cut it short. I'm with parent: I'll gladly pay taxes, they buy civilization. But lately I don't feel I'm getting as much civilization for my tax dollar as I used to, not even close.
- toast0 5y ago
  > well, the ferries are probably still timely Someone isn't on the wsdot ferry email list (anymore?). Most of the lines are currently running single boat service, or only announcing both boats will be running in the morning. I don't personally count it as being on time if you're doing half the normal number of sailings, but those are mostly on time. I'll give a pass for the regular delays on friday afternoon and sunday evening though. As far as I know, those delays are like clockwork, and we're stuck with them. (Maybe when coleman dock construction finishes, the super peak times will run more smoothly, but I'm ok with just pretending the ferry doesn't run during those times, cause I don't want to be there)
- thatfrenchguy 5y ago
  > I was just asking my wife the other day, "I don't mind high gas taxes per se, but for having some of the highest fuel taxes in the country, why is this highly-trafficked road such a piece of shit? They haven't paved it since we moved here." Suburbs in the US have too much roads per capita (thanks to SFH obsession), you'll end up with this issue almost no matter how much taxes you raise.
AlexTWithBeard 5y ago
New York State here. Some of the highest property and income taxes in exchange for - shitty expensive roads - just "meh" state university - the worst subway I saw in any country (and there were a few) and I can keep whinging for another half an hour.
- joebiden2024 5y ago
  Stony Brook, Binghamton and the publicly funded colleges at Cornell provide excellent educations, and that’s disregarding the historical excellence of the CUNY schools. I’ll grant you the subways though.
- mrgordon 5y ago
  You’re saying NYC has the worst subway? If so, you’re seriously taking it for granted. It’s the only subway I’m aware of with two sets of tracks so it can run 24 hours even while maintenance is performed usually. It’s better than basically any other subway in America as a start and certainly better than many others as well. That said, the United States is clearly terrible at public transport overall.
  - systemvoltage 5y ago
    You clearly have not been overseas. NY subways are possibly the filthiest, Ill-running subway system in the world. Frequent delays, crime, the stench, the cost; every single aspect of it is no match for say Tokyo subway or Prague metro. Improvement starts with self-introspection and realization. American exceptionalism is all I can see.
    - mrgordon 5y ago
      Well let’s see I spent the last five months in Lisbon, Barcelona, Paris, London, and Zagreb. Now I’m in Bangkok. So your assumption that I’ve never been overseas is drastically incorrect. In fact, I’d wager I’ve been to more countries than you have and I always use the subway when available. If you read my comment, I mentioned that while the US is poor at public transit in general, the NYC subway stands out for several reasons including being 24 hours, being able to perform track maintenance without shutting down due to having two tracks (something I believe no other system has), and it also has 472 stations! Prague has 61 stations and even Tokyo only has 280. So you ignored the fact that I said America isn’t good at public transit, ignored the reasons I cited that make the NYC system better in some ways than the systems you’re talking about, and instead responded with some misplaced condescension about “American exceptionalism” Stop making assumptions about strangers on the Internet instead of reading what they wrote.
a45a33s 5y ago
people will also be leaving due to lord inslee's neverending "emergency powers"
- joebiden2024 5y ago
  Inslee has improved his margin in his 3 statewide elections so clearly the more WA citizens see of him the more they like him. His COVID response was excellent and the best in the country, IMHO.
joebiden2024 5y ago
Washington has one of the best universities in the country, excellent secondary education, and is home to two of the largest tech companies in the world. It’s a shining example of American excellence to the world, and you think people will leave because of capital gains? This is silly.
devwastaken 5y ago
Then campaign for election. The democratic experiment failed because people believe the government is a separate entity from them. Once you get involved you will see how complicated everything actually is. It turns out that people vote and do things purely from belief, regardless of if it's wrong. Therefore good policy gets labeled "leftist" or "conservative", and the private interests that profit from the chaos know how to prey on beliefs far better than you can.
- systemvoltage 5y ago
  Think about the consequences of what you said. We can never know unless we get involved. It is too complex. So the door for criticism is shut and only the people inside the government can possibly know the intricacies and therefore have the right to criticize. This is also a classic defeatist perspective - we can never fix this, it is too complicated.
abeppu 5y ago
We should all be for greater efficiency of government. But ... is WA actually less efficient than other states? If so, how and why? In terms of overall tax burden, until now WA has been pretty middle of the road (ranked 24 and 27 out 50 in two estimates). https://taxfoundation.org/publications/state-local-tax-burden-rankings/ https://taxfoundation.org/publications/state-local-tax-burde... https://wallethub.com/edu/states-with-highest-lowest-tax-burden/20494 https://wallethub.com/edu/states-with-highest-lowest-tax-bur...
- atdrummond 5y ago
  The burden has been middle of the road thanks to the income tax ban. It’s also resulted in the state pursuing taxes even worse than income tax, in terms of regressivity and who they target.
kyleblarson 5y ago
Seattle is not Washington State. I invite you to visit the Methow Valley. I will buy you a beer.
- systemvoltage 5y ago
  I just googled Methow Valley. Breathtaking. I'll take your offer.
janoin93 5y ago
[flagged]

millzlane 5y ago

Sound like a move to avoid losses. TL;DR: Nadella sold the shares “for personal financial planning and diversification reasons,” the Redmond-based company said in a statement Monday afternoon. “He is committed to the continued success of the company and his holdings significantly exceed the holding requirements set by the Microsoft Board of Directors.”

samspenc 5y ago
But then, in the next two paragraphs: > It comes in advance of Washington state implementing a controversial new capital gains tax. Passed by lawmakers in April, it primarily targets stock and business ownership sales with a 7% tax on long-term capital gains of more than $250,000. > The first such tax in state history, it’s set to take effect on Jan. 1, 2022. Microsoft’s statement on Nadella’s stock sale did not address whether the impending capital gains tax factored into Nadella’s personal financial planning. A Wall Street Journal report cited analysts who pointed to a possible connection.
- millzlane 5y ago
  He says why he did it. It's not a secret. We can speculate why he did it but with no proof how do we know? If he was trying to avoid the tax altogether why not sell all of it?

JoeyBananas 5y ago

Capital gains tax is a bad idea because it hurts businesses. It takes money out of the economy and puts it into the government where it is spent less efficiently.

ttymck 5y ago
I'm sure your argument is deeper, but what you have written could be said about any tax, no? Is there something unique about capital gains tax in particular?
- pirate787 5y ago
  Capital gains taxes are double taxation...the company already pays income taxes on its profit.
  - nostrademons 5y ago
    That would be dividends. Capital gains (in theory at least) are the result of a company investing in its future earning capacity, eg. hiring scientists for R&D, building a new factory, spending money on SaaS upgrades, etc. These all come out of the income statement as expenses, and aren't recorded as profit, so the company doesn't pay corporate taxes on them. You'd potentially have a point for buybacks, which are usually paid off of retained earnings that have already been taxed and yet raise the share price and cause capital gains. This is the same issue that qualified dividends have though.
    - atdrummond 5y ago
      Those future earnings from present investments, when finally realized, will be taxed unless the corporate income tax is eliminated.
      - nostrademons 5y ago
        But someone who sells a security backed by the cash flows from those future investments is receiving cash before the cash flows have materialized (or been taxed). There's also no guarantee that they will ever be taxed. Take, for example, a startup that continually reinvests all profits in additional R&D, sales, and marketing, gets increasing large revenue streams, but then sells the whole company to a bigger one before ever realizing a GAAP profit. Capital gains tax is Uncle Sam's way of taking a cut on all the intermediate owners who benefit from the business reinvestment but know how to turn profits into larger market share.