Venture capital group wants tax breaks and regulatory relief to spur growth

A special, lowered capital gains tax for investors in companies that debut on public stock exchanges could help stimulate the economy and create many new jobs, leaders of a national venture capital group said Wednesday. Lowering the federal capital gains tax to 10 percent from 15 percent for a two- or three-year period for companies that make initial public offerings would create such broad economic benefits that it would enhance tax revenues over the long term, said Dixon Doll, chairman of the National Venture Capital Association. The tax incentive proposal was part of a "four pillar" agenda the NVCA unveiled at its annual conference in Boston aimed at reinvigorating a venture industry now struggling with an ice-cold IPO market and sluggish pace of mergers and acquisitions. The proposals also include a review of regulations such as Sarbanes-Oxley that are said to raise costs and slow the pace toward an IPO. Two other "pillars" address problems in the private sector ecosystem that includes investment banks, accounting firms and institutional investors. These initiatives involve efforts to develop new banking models to foster IPOs and identify new institutional investors for small companies.