http://blogs.reuters.com/muniland/2012/02/15/2-5-million-muni-bond-investors-unaffected-by-proposed-tax-changes/ Bridges, budgets, bonds Fri, 24 May 2013 15:47:05 +0000 hourly 1 http://wordpress.org/?v=3.4.2 http://blogs.reuters.com/muniland/2012/02/15/2-5-million-muni-bond-investors-unaffected-by-proposed-tax-changes/comment-page-1/#comment-876 hollyd Sat, 24 Mar 2012 17:41:07 +0000 http://blogs.reuters.com/muniland/?p=7630#comment-876 The part of the President's proposal that many, including myself, find offensive, is that is would retroactively change a fundamental term of bonds that were issued and sold prior to the enactment of the legislation. Investors chose muni bonds, in lieu of corporates of similar quality offering higher stated interest rates, because the promised tax exemption made them a marginally more attractive alternative. To change the rules after those bonds were marketed and sold under a promise of tax exemption, is extremely unfair to those investors who relied on the promised tax exemption in making their investment. I would not object to changes to the tax exemption for munis issued after the effective date of new legislation (although I do think it is misguided tax policy, motivated more by populist political considerations than economic policy), but changing the key terms of government securities after they have already been issued and sold is punative, unfair, and terrible public policy. The part of the President’s proposal that many, including myself, find offensive, is that is would retroactively change a fundamental term of bonds that were issued and sold prior to the enactment of the legislation. Investors chose muni bonds, in lieu of corporates of similar quality offering higher stated interest rates, because the promised tax exemption made them a marginally more attractive alternative. To change the rules after those bonds were marketed and sold under a promise of tax exemption, is extremely unfair to those investors who relied on the promised tax exemption in making their investment. I would not object to changes to the tax exemption for munis issued after the effective date of new legislation (although I do think it is misguided tax policy, motivated more by populist political considerations than economic policy), but changing the key terms of government securities after they have already been issued and sold is punative, unfair, and terrible public policy.

]]> http://blogs.reuters.com/muniland/2012/02/15/2-5-million-muni-bond-investors-unaffected-by-proposed-tax-changes/comment-page-1/#comment-695 BCman Wed, 29 Feb 2012 20:08:14 +0000 http://blogs.reuters.com/muniland/?p=7630#comment-695 What a stupid idea....When you drive the major funding for Tax Free investments out of the market, no amount of "Less affluent" investors will be able to take up the slack therefore drying up a source of funding for the Municipal Market. Someone hasn't thought this out completely!!! What a stupid idea….When you drive the major funding for Tax Free investments out of the market, no amount of “Less affluent” investors will be able to take up the slack therefore drying up a source of funding for the Municipal Market. Someone hasn’t thought this out completely!!!

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