Washington, D.C. – The American Gas Association (AGA) today released the following statement in response to the passage of the American Taxpayer Relief Act.
“This package is one that has significant implications for investors, our economy and industry across the board,” said AGA President and CEO, Dave McCurdy. “While it is disappointing that the White House and Congress weren’t able to reach a broad, comprehensive agreement to address the long term deficit, the agreement reached today is a step in the right direction. We have managed to get some short term certainty with this legislation, and we will continue our efforts in 2013 to help find a bipartisan solution to the important fiscal challenges that still need to be addressed.”
The deal will preserve and make permanent 15 percent tax rates for dividends and capital gains for individuals earning up to $400,000 or couples earning up to $450,000, while dividends and capital gains for families who earn more than $450,000 will be taxed at 20 percent—also permanent.
“AGA and its members have continued to emphasize the importance of low dividends, parity with capital gains and what those actions mean for our economy, investors, retirees and industry,” said AGA Board Chairman and Chairman, President and CEO – Questar Corp., Ron Jibson. “We are still in recovery mode, and I am pleased to see Congress take this action today to help sustain this economic recovery. While there is still work to be done, recognizing the importance of low rates for dividends and parity with capital gains is significant, and we look forward to addressing the important issues left on the table in 2013.”
Jibson continued, “Keeping dividends low will help utilities expand and rebuild their infrastructure, in turn, helping to meet the nation’s energy needs and deliver on the promises of clean, affordable and domestic natural gas for our economy, environment and national security.”
Lower dividend tax rates benefit the tens of millions of Americans who own stocks indirectly through mutual funds, and they support the value of stocks held through or in life insurance policies, employer or union pension funds, 401(k) plans, or individual retirement accounts. Lower dividend tax rates also benefit Americans who own no stocks or mutual funds by helping to spur the growth that is needed to create new jobs and to strengthen the economy. Parity between dividends and capital gains creates a level playing field and allows investors to make decisions rather than creating a tax code driven bias for one over the other.