Rich Group Gives It Up for Tax Cause

Talk about putting your money where your mouth is.

A group of wealthy people said Tuesday that they are so offended by the lack of fairness in last year’s tax law that they will donate proceeds from their capital-gains tax cut to charity or to the federal government.

“As beneficiaries of numerous policies that are tilted in our favor, we felt a responsibility to take action to create a more fair system,” said Mike Lapham, project director for a group called Responsible Wealth.

Lapham said 80 wealthy individuals who will benefit from the 1997 tax law agreed to pledge at least $628,000 to various causes, including a campaign to push for more evenhanded tax policies.

Charles Demere, a semiretired Episcopal priest and investor, said he will give $5,000 he saved from the 1997 tax act to the Fund for Tax Fairness. “Why do investors like me keep getting tax breaks while taxes fall so heavily on working families struggling to make ends meet?” Demere said. “Sure, it benefits me as a person of wealth, but I am convinced it is not good for me or my grandchildren.”

Lapham and Demere spoke at a news briefing in Washington, D.C., where Citizens for Tax Justice released a report showing that with the 1997 tax law, 81% of the capital-gains cut will go to the richest 5% of Americans. Less than 2% of that tax cut will benefit the bottom 60% in the country, the study said.

The 1997 Taxpayer Relief Act cut the maximum long-term capital-gains rate from 28% to 20%, a move that will cost the government $21 billion through 2007.

Summarizing the Citizens for Tax Justice report, U.S. Rep. Robert T. Matsui (D-Sacramento) said of Americans making $60,000 and less: “Only one in 17 of those taxpayers will get any relief at all, and it’s a mere $6.”