Fair taxes - How taxes on Capital should be structured

If one assumes that all income should be taxed equally so people share the burden of expense of government equally here is how taxes on Capital should be structured:


Dividends should be treated as ordinary income (as they used to be before the Bush tax cuts).  They are distributed profits from a business and there is no reason to give them favorable tax treatment.


Capital Gain should also be treated as ordinary income.  But there should be two special provisions, one for fairness purposes and one to encourage investment.


For fairness gain should be reduced by how long you held the asset to account for inflation.


To encourage investment you should be allowed to sell an asset and immediately roll the proceeds over into a new asset.  All the rollover proceeds would not be taxed, and you would carry the same basis into the new asset (basis is how much of your own money you originally put in).  This would need rules to ensure it is not abused, particularly when you are using borrowed money to buy an asset.