Private equity and hedge funds cautioned on Thursday that a proposed U.S. tax increase on carried-interest income could potentially hurt small businesses and big investors, such as endowments, foundations and pension funds. Carried interest refers to a longstanding Wall Street tax break that let many private equity and hedge fund financiers pay the lower capital gains tax rate on much of their income, instead of the higher income tax rate paid by wage-earners. 'Over 74% of private equity investment went to small businesses last year. As small business owners face rising costs and our economy faces serious headwinds, Washington should not move forward with a new tax on the private capital that is helping local employers survive and grow,' Drew Maloney, president and chief executive of the American Investment Council. 'It is crucial Congress avoids proposals that harm the ability of pensions, foundations, and endowments to benefit from high value, long-term investments that create...
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