Re Lew Hay’s Oct.19 letter, Don’t raise taxes on investments: If the Bush tax cuts sunset on Dec.31, there wouldn’t be any affect on the average Florida senior. Although it’s true that the top rate on dividends would increase to 43.4 percent, this would only apply to individuals with a taxable income of more than $370,000.
It’s also true that the top capital-gains tax rate will go up to 23.8 percent, which is still a historically low rate that wouldn’t discourage investment.
Hay also implies that dividend-paying stocks would fall in price because they would have less value, as a result of the higher tax. The stock market is a discounting mechanism, and the Obama plan to let the Bush tax rates sunset for individuals with income above $250,000 is old news. In fact, the Dow Jones Dividend Index, is trading at less than one dollar below its 52-week high, and the same is true for NextEra Energy. How does he explain that?
Barry Rabinowitz, Plantation