Obama Health Care Bill Increases Capital Gains Rate to 23.8%

According the this story by Bloomberg, the tax on dividends and long term capital gains under the Obama Health Care Bill will spike to 23.8% when the tax increases are fully implemented.  The article states:

Obama’s budget proposes to allow the existing 15 percent tax rate on dividends and capital gains to rise to 20 percent in 2011 for the same high-earners. Layering a 3.8 percent Medicare tax on top of that would mean a new top rate on dividends and capital gains of 23.8 percent. The top tax rates on interest and rental income would rise to as high as about 44 percent, assuming other Obama tax increases on high-earners are enacted.

It will be interesting to see how the investment management industry will react to this 50% increase in taxes on dividends and capital gains.