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As Congress plots new ways to tax the private equity game -- after all, "that's where the money is" nowadays -- tax revenues from private equity are already surging. Natch -- that's just what we supply-siders predicted when dividend and capgains taxes were cut in 2003. Our friend Dan Clifton has more:

Private equity deals and share repurchases have always occurred - its just happening now on a level that it is making a difference. In fact, the combined dollar value of these two variables equaled $1.24 trillion in 2006 and increased more than five-fold from 1.5 percent of market cap in 2003 to 7.6 percent in 2006.

The large surge in the retirement of shares is leading to increased tax revenues...Despite this surge of new tax revenue a proposal is being floated to change the tax treatment of private equity. Based on the rhetoric you would believe private equity players are paying no taxes when in fact we find out that they are providing the revenue source which has significantly improved the nation's fiscal situation. But as with anything which involves large amounts of cash, such as private equity, politicians are clamoring for a piece of the pie.

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