Five senators — four Democrats and one Republican — want to exempt venture capital firms from a proposed tax increase on managers of investment partnerships.
Scott Brown, R-Mass., along with Democratic Sens. Patty Murray of Washington, Mark Warner of Virginia, Bob Casey of Pennsylvania and Jeanne Shaheen of New Hampshire, said subjecting venture capital firms to higher tax rates on carried interest would hurt job creation and “could not occur at a worse time.”
Senate Finance Committee Chairman Max Baucus, D-Mont., is considering adding the proposed higher tax rate on carried interest to broader compromise tax legislation. The rate could reach as high as 35% compared with the current capital gains tax rate of 15%.
The five lawmakers all voted for an earlier version of the broader legislation, which would help unemployed workers and renew popular tax breaks.
“We encourage you to include language in any carried interest provision that maintains a capital gains incentive for those who contribute to the viability of our start-up community — venture capitalists,” the senators wrote in a May 11 letter to Mr. Baucus and Iowa Sen. Charles Grassley, the committee’s ranking Republican.
The five senators stopped short of saying they would oppose the broader measure if it includes the tax increase on fund executives.
House Ways and Means Committee Chairman Sander Levin, D-Mich., said earlier this week that no industries would be carved out of the legislation.
