Tuesday, 26 July 2016
Last updated 51 min ago
Mar 18 2011 | 1:26pm ET
One of the namesakes of last year's financial regulation reform bill is proposing a big new tax on hedge funds and other financial firms.
Rep. Barney Frank (D-Mass.), now in the minority in the House of Representatives, has introduced a bill that would have hedge funds with more than $10 billion in assets, and other financial firms with more than $50 billion in assets, pay a collective $2.5 billion. The money would be used to save four housing programs that Republicans want to cut in an effort to slash the budget deficit.
Frank had proposed a similar levy to pay for his Dodd-Frank law, but it was dropped to win Republican support. It would seem to have a similarly slim chance of passing this year, with Republicans now in control of the House and in greater numbers in the Senate.
Frank's bill follows another bill introduced by a Democratic representative, Illinois' Jan Schakowsky, that would hit hedge fund managers personally. Schakowsky's bill would boost the top rate of tax in the U.S. from 35% to 49% for people who earn $1 billion or more.
The current tax code "fails to distinguish the merely 'well-off' from the 'super-duper rich,'" Schakowsky wrote in the Huffington Post.
Her bill, which has next to no chance of passing, would also increased taxes by at least 10% on everyone who earns at least $1 million.