(Bloomberg) Democrats are beginning to flex their legislative muscle over ending a popular tax break used by private equity and hedge fund managers that is nearly universally despised in the party.
Senator Tammy Baldwin of Wisconsin and Representative Bill Pascrell of New Jersey re-introduced legislation Wednesday that would end the break known as carried interest. The provision allows fund managers to have some of their income taxed at the 23.8 percent capital gains rate, rather than the top ordinary rate of 37 percent. For years, Democrats have proposed plans that would end the carried interest tax break. This bill isn’t likely to become law anytime soon, but it would be one of the easiest tax issues for Democrats to agree on if they sweep the House, Senate and White House after the 2020 elections.