Bloomberg- Senate Finance Committee Chairman Max Baucus said his panel is “looking at the general question” of how hedge funds and private-equity firms are taxed, though Congress is “nowhereclose” to drafting a bill.
“I’m not close to having legislation, not yet, but I may,” Baucus, a Montana Democrat, said today at the National Press Club in Washington. “My view is, first I want the facts. I want to know what’s going on here.”
A staff-level review in the congressional tax committees is focusing on several issues, including the ability of fund managers to pay the 15 percent capital-gains rate on a large portion of their pay, Baucus said. Other issues under review include how fund managers use offshore tax havens to defer large amounts of pay and the intention of Blackstone Group LP, the private-equity firm seeking to raise $4 billion in an initial public offering, to avoid the 35 percent corporate tax on most of its income.
“I’m looking at it all,” Baucus said. He added: “This is all very preliminary. I’m nowhere close to knowing what we should do and should not do.”
Baucus dismissed published “allegations” that his panel is close to drafting legislation or deciding on a policy as “pure speculation.”
“People need to keep their shirts on here,” he said. He is considering a number of issues, including the effects of any change on the ability of the U.S. to compete globally, he said.
