WASHINGTON, July 21 (UPI) -- The tax rate paid by billionaires is fueling a Wall Street-versus-Washington dispute over fairness in the U.S. economy, it was reported Saturday.
Leaders at equity firms such as Blackstone Group and Kohlberg Kravis Roberts & Co. are making millions on each deal as they buy and sell some of America's biggest companies.
Much of their profit is considered investment income and taxed, therefore, only at the 15 percent rate for capital gains, The Los Angeles Times reported.
Congress now is considering whether to tax those earnings at the ordinary income tax rate, which is 35 percent for anyone making more than $379,000 a year.
A plan in the House could mean a bigger tax hit for highly paid managers at private equity funds, venture capital funds, real estate trusts and hedge funds. A narrower Senate proposal would apply only to private-equity firms and other funds that are publicly traded, such as Blackstone Group, The Times reported.