Don’t forget – sign up for our free daily newsletter to stay in the activist investing know. Donald Trump is the number one contender for the GOP Presidential nomination. Love or hate him — really appears to be no in-between — he’s taken the illegal immigrant issue to task and now turning his aim to the tax code.
Hillary Clinton has voiced here own concerns over Wall Street and capital gains taxation. Trump is now in on the hedge fund bashing, noting, “The hedge fund guys didn’t build this country. These are guys that shift paper around and they get lucky….They make a fortune. They pay no tax. It’s ridiculous…”
Trump’s issue is carried interest that allows hedge funds to pay taxes at capital gain rates instead of ordinary income.
The answer, per Donald Trump, is to simplify the tax code by reducing deductions and lowering rates for the middle class. Trump is incensed that a person earning $50,000 has to spend money on professional advice from H&R Block to file his returns.
Basically, H&R Block would be rendered useless. Trump is the self-appointed “king of maneuvering the tax code,” enjoying laughs with his hedge fund friends about “how little they pay”.
Now — there’s been a call for tax “simplification and reduction” for some time. With many complaining that the tax code is filled with complexities and idiosyncrasies.
H&R Block isn’t throwing in the towel. In an interview, CEO Bill Cobb said that he doesn’t want complexity in the tax business. But any President will have to deal with 535 people in the Congress to amend any tax laws. Bill does not that complications arise from social programs like dependents and child care, Affordable Care Act, etc. No doubt a ploy to pacify H&R Block investors.
This also comes as the company just installed a fresh $3.5 billion share buyback. Get ready for some buyback blowback and look for the calls for H&R Block to go private to resurface if Trump makes his tax plan public this month.