Subject: Re: OT Push to index capital gains
Some part of the reason for the lower rate on cap gains is presumably the assumption that there has been some inflation during the hold period,

A big part of the reason for capital gains to be taxed less than ordinary income is to encourage investments. That's partially the rationale for taxing long-term gains lower.

The whole business of a separate capgains rate is silly. It used to be taxed on on 1/2 the gain at the same rate as ordinary income. That was much simpler.

The basis should be indexed by the inflation rate, because the non-indexed rate is just taxing a phantom profit.

But those two reason is probably why they won't index. Because those two things got more tax revenue.