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anon291today at 7:31 PM1 replyview on HN

Yes let's encourage more risky behavior! Absolutely braindead takes.

This sort of proposal would establish a minimum 35 % return in any project. Thus halting investment entirely

Let's put this in perspective. I'm currently going to collaterize a few hundred thousand in equity to take a loan to develop homes in my very housing short city of Portland. My calculated return is 40%. This is an excellent return..

It this were taxed then my initial loan would have to be 40% larger which means all my profit would go into paying that back, which means this project never gets done.

You are already going to get the money once the homes are sold and the capital gains are realized. Why is everyone so greedy? You essentially want to tax twice


Replies

jwlaketoday at 10:20 PM

The point is you should realize your gains before you reinvest the money. Circular borrowing causes asset bubbles. You could collateralize against OTHER assets, but unrealized gains you should be paying taxes on if you are borrowing against them. It's really just closing a loophole. If the loophole is BIG enough, the you could lower the rate for everyone!

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