The second result from a rise in capital gains taxes is that it would change the return on investment which would lower the overall rate of saving and investing and as a consequence lower the overall capitalinvestment which in turn would lower GDP growth and expansion.
So he advises clients, gratis, on setting up internal corporate venture capital funds, hoping to get a return on that investmentof time, with paid assignments later.
The venture-capital industry specializes in locating and assuming the large risks of this sort ofinvestment in return for a share of the rewards when successful.
This way capital gains and dividends will be taxed at a top rate of 15%, whereas the investmentreturn on deferred pay is all eventually taxed as ordinary income at a top rate of 35%.