Property or capital gains taxes could help curb demand for housing as an investment vehicle.

Many countries tax systems hugely favor debt over equity.

Direct interventions, restrictions on short term capital inflows, capital gains taxes, and stabilizing prudential banking regulations will all have to be considered.

The February 27 decline began with an 8.8 one day drop in the Shanghai Composite, following news that the Chinese government might tax capital gains more aggressively.

The top personal income tax rate (also levied on capital gains), the sales tax rate, the corporate tax rate, and the gas tax are all at or near the highest of any state.

One of them is a reserve requirement on cross border flows successfully implemented in Chile, Colombia, and elsewhere or, even better, on cross border liabilities. Taxes on inflows can play a similar role, as can minimum stay periods for capital inflows.

A recent study found that taxing capital gains and dividends as ordinary income, subject to a maximum 28 rate on long term capital gains (the pre 1997 rate), could finance a cut in the corporate tax rate from 35 to 26 .

Property or capital gains taxes could help curb demand for housing as an investment vehicle. In addition, a comprehensive nationwide housing policy is urgently needed to ensure that housing remains affordable, particularly for those on limited incomes.

This is bad news for reducing income inequality, as capital gains and high end wages may grow much faster.

Strauss Kahn s response that taxes on capital flows are costly and ineffective is therefore unfortunate.

That is in addition to explicit tax hikes on income, capital gains, and dividends, the implicit ones on energy via cap and trade, etc. It appears that the Obama strategy is to stuff the beast (the mirror image of the tax cutting starve the beast philosophy attributed to some of President Ronald Reagan s advisers), i.e., to initiate massive spending and hide the true cost from citizens.

Unfortunately, any country that taxes capital too aggressively will only succeed in chasing it to regions where the tax burden is lighter.

In some cases, US firms bought the banks, held on to them until Korea recovered, and then resold them, reaping billions in capital gains.

But, lacking capital and forced to pay taxes, what fate awaits industries driven by the state into the market?

Initial capital

No one can determine how much of America s productivity gains in recent years have resulted from squeezing human capital, because such things are not measured.

Today, capital in the developed world is abundant the saving ratio declines as people consume more and production shifts increasingly to services, where productivity gains are limited.

Inflation remains contained, but, more to the point, China s government has an arsenal of other weapons (from taxes on capital inflows and capital gains taxes to a variety of monetary instruments) at its disposal.

As above, firm value is enhanced when, and if, the return on capital exceeds the cost of capital.

The Art of Capital Flight

Damming Capital

The Capital Flow Conundrum

Capital flows and remittances

E. Financial capital and resilience

Governments do not tax the return on equity less than debt interest, and lenders do not sufficiently honor the benefits of high equity with lower interest rates, owing to a lack of information about the true repayment probability.

The portion of capital inflows that is not re exported represents net capital inflows.

The timely reporting of non realized capital gains and losses makes the shares of the company that holds them volatile, sending shock waves through the financial system.

All realized and unrealized gains or losses on contributions receivable are accounted for under the Annual Programme Fund, unless required to maintain the Working Capital and Guarantee Fund.

Second, wealth effects are maximized when debt service is minimized that is, when interest expenses do not swallow the capital gains of asset appreciation.

The Siren Song of Capital Controls

Investment and private flows

(o) Working Capital Fund

Brazil has been aggressive in terms of capital restrictions, twice increasing its tax on financial inflows.

Why should those who make their income by gambling in Wall Street s casinos be taxed at a lower rate than those who earn their money in other ways. Capital gains should be taxed at least at as high a rate as ordinary income.

Under such circumstances, the upper middle classes in developed countries increasingly came to look for capital gains instead of improving their living standards through productive work.

The International Monetary Fund has put its stamp of approval on capital controls, thereby legitimizing the use of taxes and other restrictions on cross border financial flows.

व श व क प ज क र ख फ र ट यर क ओर

Jacqueline Novogratz on patient capitalism

The reason lies in capital movements.

Finally, there is the path of public capital.

Surviving the Great Capital Flood

Raising capital is expensive.

The Temptation of China s Capital Account

List of tables

If, on the other hand, market participants do bear significant costs either because of the taxes they pay or because of the expenses they incur to evade them the controls will be effective in restraining inflows.