[lbo-talk] The tax deductibility of debt

[Max Sawicky]

For a business you could say interest is taxed to the recipient, so taxation
at the corporate level would be double-taxation.  By that logic they should
deduct dividends too.  Or not deduct interest to have parity with dividends.

For individuals you could argue that it should be the same as for
businesses, on the analog that an individual's transactions are his own
'business.'  There is of course a blur between personal borrowing and use of
home equity (interest on which is deductible).

On Tue, Aug 31, 2010 at 3:22 PM, Michael Pollak <mpollak at panix.com> wrote:


>
> What's the rationale and origin for the tax deductibility of interest
> payments?  Besides mortages -- I understand the original rationale there.
> But I don't understand it for any other business or consumer financing. And
> was there a specific moment in time when this decision was taken or did it
> just sort of accrete?
>
> Michael
>
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