US venture capitalists worry over tax threat

A bill proposed by the US House of
in June that would sharply increase the tax rate for venture
capitalists has set alarm bells ringing.

It proposes that the 20% fee that VCs collect on their profits, which is
currently taxed at the capital gains rate of 15%, be taxed at the ordinary
income rate of up to 35%.

The higher tax would apply to venture capital, along with private equity and
hedge funds and similarly structured funds for real estate and oil and gas

have launched a lobbying campaign to convince lawmakers the bill
has the potential to dampen entrepreneurship, put the US at a competitive
disadvantage, and drive the brightest graduates a way from a business that
bootstraps risky start-ups and nurtures new technologies.

Further reading:

On the money with Damian Wild

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Insider Business Club: private equity

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