A Perfect Example of What Not to Do

22 Feb

50p tax rate ‘failing to boost revenues’.

Or how raising taxes does not necessarily create more government revenue.

Do you think our Government will learn from this example? Not likely, our President and resident economic “wizard of smart” Barack Obama wants to raise the dividend income tax rate to 44%. I will guarantee that is this occurs, investing in “buy and hold” stocks will all but come to a stand still as investors adapt other strategies to avoid the new tax rate. The result will be a more volatile stock market as “buy and hold” falls out of favor and a reduction in revenue from dividend income taxes and not the huge gain that the OMB with their “head in the sand” static scoring model had predicted.

Elemental economics at work. Something that Washington seems to not even remotely understand.

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Posted by on February 22, 2012 in Uncategorized


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