Monday, October 23, 2017
Eric Toder (Tax Policy Center) presents How Do We Tax the Income of Entrepreneurs? at Loyola-L.A. today as part of its Tax Policy Colloquium Series hosted by Katie Pratt and Ted Seto:
Entrepreneurs create successful enterprises that generate substantial value through the innovations they introduce. They typically must wait many years before their firms generate net operating profits. The tax system favors entrepreneurial activity by allowing deferral of tax on the accrual of wealth within new firms and by taxing the gains of entrepreneurs when realized at favorable capital gains rates. But taxes on the income of mature enterprises offset some of this benefit by reducing the value of the firms that entrepreneurs create. Taxation of entrepreneurial income matters because of the important contributions the innovations entrepreneurs introduce make to economic growth.
Victor Fleischer (San Diego) and Roger Gordon (UC-San Diego) are the commentators.