The rich will be crying into their monogrammed handkerchiefs. Barack Obama, US president, promised to soak the wealthy while campaigning, and proved good to his word in the budget plans announced last week. While marginal tax rates are going up for the highest paid, partners at private equity firms are in for particularly vigorous treatment.

Carried interest – a share of profits from a fund paid to those managing the money on behalf of investors – will be taxed as income, not capital gains. Typically the main source of remuneration for those running buy-out operations, reclassification will see the tax rate jump from 20 per cent (itself up from 15 per cent now) to 39.6 per cent. State governments will also be after their share.