A CONSENSUS has emerged among centrist economists that realized capital gains, before they are taxed, should be indexed for inflation in order to exclude phantom gains. Indexing means multiplying the historical cost, or tax “basis,” of the asset by a price index before subtracting it from sales price. This, apparently reasonable proposal is, in fact, partial and dicriminatory. All assets, not just capital assets, are “taxed” by inflation.
1990. Am. J. of Econs. and Sociology 49(4):399-400, October.
