Silence On Carry In Tax Deal
The tentative Dec. 7 tax deal between President Barack Obama and congressional Republicans made no mention of raising taxes on private equity gains. And the Senate Finance Committee had already dropped that idea from a bill to extend broader tax cuts enacted in 2001 and 2003.
Proponents of higher private equity taxes argue that carried interests, essentially free stakes typically of 20 percent in the funds buyout firms manage, should be treated as income earned for investment management services, points out Breakingviews, a sister commentary service to Buyouts. Such a change would subject carried interests to the highest marginal income tax rate on ordinary income. Under current U.S. law, profits earned by investment fund managers at hedge fund and private equity firms are taxed as capital gains at a much lower rate.
Pete Peterson, the co-founder of buyout firm The
Australia Takes Bite On Sales
Other nations taking a harder line. The Australian Tax Office ruled Dec. 1 that gains from asset sales by private equity firms would be taxed as income, ensuring that buyout lobbyists will head to Canberra in the new year to call on the government to legislate to overturn the ruling, according to Reuters, the publisher of Buyouts.
The ruling stems from a dispute between the tax office and private equity firm
The ruling specifically targets private equity firms that are domiciled in international tax havens.
Sigular Sues Boyazny
The complaint, filed Dec. 3 in the New York Supreme Court, the state’s trial-level court, accused Boyazny of stealing “commercially sensitive information” when she left, including information on the firm’s investors and funds’ positions. Boyazny has 20 days to respond, LBO Wire said.
Boyazny could not be reached by deadline. She told Buyouts in November that her new partner, G2 Investment Group, has a whole different set of investors for her to reach out to.